This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Street Clears the Air

Going green could bring a lot of green to investors and investment banks.

Fast-emerging opportunities to trade carbon dioxide -- the gas linked to global warming -- are moving it into the limelight.

And Wall Street firms better known for making a bundle trading traditional commodities such as natural gas and oil are seeing an opportunity to make money from efforts to clean up the environment.

Morgan Stanley (MS - Get Report) announced last week that it is committing $3 billion over five years to expand its existing carbon and emissions trading business, including private equity investments in projects related to emissions reduction.

In September, Goldman Sachs (GS - Get Report) purchased a 10% stake in the Chicago Climate Exchange -- a three-year-old electronic commodities exchange that focuses exclusively on trading greenhouse-gas emission allowances in the U.S.

Carbon trading is catching on in the U.S. and especially in Europe as a way for countries and companies to comply with strict guidelines for reducing so-called greenhouse gases such as carbon dioxide.

The concept is an outgrowth of the Kyoto Protocol, an international treaty designed to reduce the risk of global warming.

The U.S. does not follow the treaty, which President Bush rejected soon after he took office in 2001. Bush said the measure was too punitive on polluters and the mandates to reduce carbon emissions would hurt the economy.

The process entails the buying and selling of "allowances,'' the amount of carbon dioxide emissions companies are allowed to emit under the Kyoto treaty.

Companies that emit less pollution can sell their excess allowances to other companies, which pollute too much and can't reduce their emissions to acceptable levels.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
CME $94.53 -0.19%
GS $192.26 2.30%
ICE $230.76 -1.10%
MS $35.97 0.78%
AAPL $124.25 -0.14%


DOW 17,698.18 -77.94 -0.44%
S&P 500 2,059.69 -8.20 -0.40%
NASDAQ 4,880.2280 -20.6570 -0.42%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs