The future of the E-Waste industry as an investment

[Exprezchef]

This past weekend our community had a free E-waste drop off center set up in a parking lot for disposal of old electronics. I was dropping off some old broken and unused items to prevent them from ending up in a landfill and started up a conversation with the manager of the company who was running the show. He was explaining that this type of recycling is still in its growing phase and so far business had been very good for him. He explained that there are governmental mandates coming up in the near future that will cause this industry to explode. What are your thoughts on investing in this type of industry?

[Dicey]

Investing in such a specialized area unless you have a big, fat, diversified, low-cost portfolio and are FI is a sukka bet. Stick to a broad range of low-cost index funds and don't get caught looking for fool's gold. But that's just my opinion, since you asked.

[johnny847]

I concur. This is equivalent to investing in a single company's stock, which I would never advise at anything more than 5% of your total portfolio.

[dividendman]

Also note that just because an *industry* is going to take off does not mean the businesses in that industry are going to do well! It sounds paradoxical but it's not.

Airlines and flight is the best example. Up to about 10 years ago the businesses in the industry had turned out to show a NET LOSS - in an industry that has gone from non-existent 100 years ago to the main way people move long distances.

Car companies and automobiles is another less drastic but clear example.

[Outlier]

E-waste is one persons waste and another persons way to get a college education. I'm a frugal geek and I'm typing this on a computer that was another persons e-waste a few months ago. It takes a lot of on the ground knowledge to know what's still usable and what isn't but second hand electronics can sell like crazy if you're dialed in on what makes money.

It's a very tight margin business though. I dunno how government recycling programs can help but the secondary market on electronics is very fickle and it takes a lot of knowledge to turn one persons junk PC into another persons low end Linux gaming rig.

[Exprezchef]

Thanks to all for the replies. I have a pretty broad mix of a portfolio so it would just be a small part anyway. I was just looking for thoughts on the subject.