Investment Analysis of Global Waste Management - Research Proposal Example

Sustainable investment, Investment analysis of Global waste management Investment Analysis Original 1st June 2010. Author Writer’s Name Table of Contents Introduction Survey of Previous Research and Literature Proposed Research Question Data Collection Time Period Research Methods Analysis Conclusion Introduction The sustainable investment that has chosen to analyze is Global Waste Management. The Global Waste Management sector deals with the collection, processing, recycling, transport and the disposal of waste (Society General SGI, 2009). It is a worldwide sector of the waste industry that deals with the efficient disposal, collection and/or recycling of waste. Because wastage is a recurring activity and there is always a need for a waste management society (Griffiths, J. and P, Williams, 2005) to take care of all excessive wastage and garbage, its important that this industry keeps on functioning properly. The decision to choose Global Waste Management as the primary sustainable investment is based on a number of factors. The Global Waste Management has been described as ‘sustainable’ because of the needs of the people for effective disposal of waste and the excessive waste that is produced every year makes this industry a major need for the people, making it a highly sustainable investment that must function properly at all times. Because it is so heavily required by the people, the Global Waste Management industry has been deemed as sustainable and it is an industry which would always keep on reaping results. There are a majority of ESG factors that contribute to the sustenance of this investment. The major environmental issue that is faced by a majority of people is the disposal of waste, and many are not so well equipped to dispose of their waste properly, which results in pockets of excessive garbage popping up all over the city. Therefore, the need for a Global Waste Management sector to preside over all waste management operations needs to be set forth. Waste is fast becoming a big problem for many people, and all of them wish to dispose of it effectively, however due to the lack of a proper waste management body, it has become quite problematic for people to dispose of their waste properly. Excessive waste releases harmful gases and poses a big threat to the society as well Emissions of ammonia, N2O, and CH4 during composting of organic household waste ((Beck-Friis, B.G, 2001). The governing bodies usually cannot form a department and take care of waste because of all the other things that are required by the government. Therefore, the need for a global waste management sector rises ever more, and hence it is a highly sustainable investment that shall keep on reaping rewards till the end. The reasons for choosing Global Waste Management as a sustainable investment are also quite diverse. Countries all over the globe have a wastage problem which they cannot address properly, and this is leading to the build up of excessive areas that are just loaded with waste. These waste sites could be finished if a proper waste management system is implemented and put in place, and hence it would bring about benefits in two ways. Due to the dependability of the system on the GDP, it makes investing in Global Waste Management quite secure because the GDP of a country is bound to be good if the country wishes to excel and hence this would just result in a sustainable and a steady return from Global Waste Management (Ackerman, F., 2000). More over, the environmental and the governmental issues that have been enlisted above also make the viability of Global Waste Management an extremely important organization. Survey of Previous Research and Literature: A lot of material has been written on Global Waste Management. In this section, we shall discuss and analyze some of this literature in order to prove that Global Waste Management is actually a sustainable investment. There are a number of reasons that are cited in the official brochure that comes on Global Waste Management. There are many reasons why a person would want to invest in the Global Waste Managing industry. The main reason that can cite for the rise in the global waste managing sector is due to the incremental values of the population. The rate of the population is rising extensively, and this has contributed greatly to large amounts of waste being exhausted from homes ((Tuhkanen, S., R. Pipatti, K. Sipilä, and T. Mäkinen, 2001). However, in many countries there is the absence of an effective Waste managing industry has been cited which just increases the need for a global waste management sector. More over, environmental factors have also contributed to the rise in the need of a global waste management sector, and this has caused a lot of issues because exhausted waste that is not treated properly causes a huge problem for the people and poses a large threat to the environment (Iskandar, L., 2001). The informal solid waste sector in Egypt: prospects for formalization. The emission of harmful gases and CFCs from rotting waste has been cited as one of the main reasons for global warming (Societe General, SGI, 2009) and this is really damaging the ozone layer of our planet (Bogner, J., et.al, 2003). Therefore, the need for an effective industry that properly deals with all excessive waste has become all the more prominent, and it is vital that the proper development and functionality of a Global Waste Management sector be put in to place to deal with all such issues (Kaseva, Mbuligwe, and Kassenga, 2002). Another issue that is faced by the people is the rising prices of energy as well as commodities (Societe General, SGI, 2009). This has contributed greatly to the need and sustenance of a global waste management sector, because people need a place to effectively dispose of their garbage and due to the limited space of dumping waste, it has become near to impossible for them to dispose of their waste properly (Borjesson, 1996) Therefore, another reason why investing in the Global Waste Management sector might be so profitable comes in to view. It is all the play of the Gross Domestic Product, and they are both proportionally linked. The higher the Gross Domestic Product, the higher would be the exhaustion of waste and hence the higher would be profit made by the Global Waste Management. Another reason that has been cited by the Society General Brochure on Global Waste Management which makes it a sustainable investment is the lack of landfills for people to dispose of their waste (Burnley, S., 2001). Due to the rising number of the population, the number of landfills that have been completely topped to the brim have risen sharply (Bramryd, T., 1997) and now many people don’t know what to do with their waste. Garbage incinerators are at a low and many people are unaware of such methods for effective waste disposal (Bockreis, B. and I. Steinberg, 2005). However, a Global Waste Management industry could make sure that the waste is disposed of correctly, and it would keep on functioning and always remain in a profit because of the large amounts of waste that it would be disposing every month (Morris, J.R., P.S. Phillips, and A.D. Read, 2000). The Global Waste Management could highly profit because municipal waste is the clear function of the GDP per capital (MSCI World Index, 2009). The functionality of the Global Waste Management sector has also risen when one compares the trends of the past few years (S&P 120 World Index, 2009) and this just shows the high functionality as well as the popularity of the sector. Cumulative returns have been estimated at a much higher level than the initial investment which further proves that the Global Waste Management industry is become hugely popular and is a safe and a viable investment for a majority of the people (Societe General, SGI, 2009). The more one invests in this industry, the higher would be the profit that one can gain and because waste is a recurring activity, one can be sure that the Global Waste Management Sector would not just fade away into oblivion (Hoornweg, 1999). Several other reasons could be cited that suggest that investing in a global waste management program could be a great way to securing a steady and a profitable income every year. As stated above, the cumulative returns graph of the past five years of Global Waste Management has been extremely positive and investors have reaped great rewards from it. This is mainly because the business forms a basic need for the people. Every country needs an effective waste management program so that they can dispose or recycle their waste properly (Daskalopoulos, E., O. Badr, et.al, 1998), however if that system in not in place, then this leads to under development and poor organization of the work force. A department that is completely focused towards waste management would also have the backing of the country’s government, and hence it would not be suffering or go through a bad phase at all. The catch here is that Waste Management is a requirement, a need, and hence it MUST be fulfilled. There are many companies that are functioning on the large scale at present which deal in waste management. They are assigned portions or areas of the city in which they have to offer transportation, collection, recycling, incineration or disposal of waste (Huang, Q., 2006). And due to the rising number of the population, the rate of exhaustive garbage is also increasing which brings about higher profitability in the business. Investing in global waste management is a wise idea to say the least, because the rising population results in rising wastage, which indirectly calls for a rise in the number of waste management companies that are present all over the world. If a company needs to progress and develop their infrastructure in a proper manner, it is imperative that they address the issues of wastage and this can only be done if there are waste management companies present and functional in that country (Zinati, G.M., et.al, 2001). Therefore, it is important that a country invests part of its money in an efficient waste management program, and this could make life really easy for them (Simmons, P., 2006). However, the sector is also open to public investing, and the rising profits that are accumulated by the sector provide dividends in high amounts to their share holders. Keeping all the previous research and literature in mind as well as the marketing indexes that have been reviewed, it can be easily depicted that Global Waste Management is a sustainable investment none the less and is going to provide its investors with a sustainable profit in the future. It is safe as well, because even if the stock market crashes or anything, it won’t affect the profitability ratio of this sector of the market because waste management is an ever needed facility and the companies would just have to provide their services to the people all over (OECD, 2004). The SGI Global Waste Management Index shows the cumulative returns that are achievable in the sector, as well as the liquidity ratios and other tradability constants. It is widely recorded as a popular marketing index to check the cumulative performance of the firm and to see its functionality as well as feasibility before making an investment in the business of Global Waste Management. The MSCI World index is an index of the stock market which shows the stocks of over 1500 world stocks, with Global Waste Management being one of the major players in the stock market. It enlists all the Waste Management companies from various countries as well as their annual returns which can be used to check the maximum profit that one can make from investing in a field such as Global Waste Management. Proposed Research Question: Is Global Waste Management a sustainable investment? This essay is going to analyze whether investing in Global Waste Management is sustainable or not. The research material that have used varies, and it has been compiled from several sources and marketing indexes to find the most appropriate resources so that the result that is finalized is accurate and completely true. Therefore, the use of several marketing indexes has been applied so that the information be completely accurate and enforced by evidence. According to the analysis so far, Global Waste Management is certainly a sustainable investment that could provide a lot of returns to investors due to the large number of waste that needs to be disposed. Data Collection The data that shall be used in this analysis has been taken from a variety of sources. The data and the numerical figures have been mainly taken from the SGI Global Waste Management Index, the S&P Global 120 Index and the MSCI World Index. It was important to take the data from a variety of sources to prove the integrity of the results and to assure that a large number of sources proved the final point and answer the question of Global Waste Management being a sustainable investment or not. The data which has been chosen is being observed on a monthly basis. This is because returns and investment rates change drastically in a month and if you take it in a year, then the results might not be as accurate or up to date. Hence, it was important that the data be observed on a monthly basis so that any changes in returns or rates would be instantly recognized. ( Add Graphs ) Research Methods: Several research methods have been employed to compile the most accurate and the precise information for this investment analysis. Most of the data has been compiled from the internet, and some of it has also been taken from the brochures that are written on Global Waste Management. Marketing indexes were also reviewed to check for the most accurate information that would be up to date. Only the data from the past five (5) years has been taken to ensure that all information that is viewed in this analysis be recent and up to date with the latest information and numerical figures. i) Returns: The returns of the past 5 years that investors have managed to accumulate have been assessed which show that the Global Waste Management industry is really a sustainable investment and provides investors with a steady return. The cumulative returns have always been higher than initial investment if looked at from July 2005, and at present they are also more than the initial investment. ii) Risk: The risk involved in investing in the Global Waste Management sector is comparatively low, because waste management is a field that needs to function all the time so that the needs of the people can be properly fulfilled and addressed. Due to the high number of returns that have been apparent from the past five years, the risk involved in investing in the Global Waste Management sector is quite low, and hence the number of investors has taken a sharp turn for the top. iii) Portfolio: The portfolio returns that have been estimated from the Global Waste Management industry are quite high as well, and because the rising GDP, the waste industry has also begun to function on a higher level in order to be able to meet the needs of the people. iv) Correlation and Relationship with other assets: The correlation matrix of the Global Waste Management industry is also quite favorable for investors and shows a good profitability ratio as compared to other assets. It also goes on to show that investing in the Global Waste Management sector is much more of a profitable business due to the high index values and the large number of returns that can be generated from it. Add Graphs Analysis After completely analyzing the whole report, it can be said that the results are quite similar to the other studies that have been carried out, and the same conclusion that was reached by those studies has been intimated here. The Global Waste Management is indeed a sustainable investment which shall provide a steady return to investors depending on the company that you choose to invest in. As it is a global project, a choice matters a lot, however, because effective disposition of waste is the requirement of every human being as well as that of the planet so it is vital that the Global Waste Management industry keeps on functioning, and hence the reason why cumulative returns have been high through out the past few years. Further more, due to the rising number of the population, the waste disposition is also rising which is giving birth to new waste recycling companies and incineration factories that are created to deal with wastage and garbage in a proper and an effective manner. The Global Waste Management is quite a sustainable investment that shall give good returns to its investor. Conclusion In the end, it can be said that investing in the Global Waste Management industry is indeed a great way to increasing your profits. The Global Waste Management industry has been paying high cumulative returns over the past five years, and this trend is likely to increase even further as the population levels rise, which increases the overall waste production from an average home. Therefore, the prominence of companies that deal with wastage is also on the rise, providing a rising curve when it comes to the profits and the returns that can be generated from the Global Waste Management industry. The research is limited to a certain extent however, because all the data which has been documented has been done so from the past five years, and the stocks might take a sharp fall without any notice, so there is always a marginal risk involved in any study that is undertaken. However, all marketing indexes have been thoroughly reviewed to ensure that the data that has been taken is accurate and contains the correct piece of information. In the end, after assessing all the information and results that have been documented in this analysis, it can be easily concluded that investing in the Global Waste Management sector is indeed a good investment that would provide the investor with steady returns and a good overall profit at the end of the year. It is a viable and a wise investment for anyone who’s wishing to earn healthy dividends over their invested money. 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