Should I invest in electric cars?

1. The up-and-comers. If you bought Tesla stock in 2013, that worked out pretty well for you. Unfortunately, the Tesla boom has everyone looking for the next electric vehicle jackpot and you probably aren't going to find it within the same industry. Instead, you have opportunities to buy shares of existing companies — like Ford or GM — who are entering the market that Tesla helped create. While there are a lot of emerging companies, especially in the electric truck department, I'm not going to encourage you in that direction unless one of those manufacturers has a product you really love. At this point, we still have to see if these unknowns have the capacity to deliver a vehicle the public wants to buy.

2. The macro view. To start, think of the electric car market as a whole entity. Between 2020 and 2021, sales of electric vehicles doubled. During that same time span, automobile sales fell overall. People clearly trust the new cars hitting the market and are choosing to head in that direction. A lot of countries have implemented penalties for manufacturers who don't move toward zero-emission vehicles, pushing the needle even further from gas toward electric. All of this is to say, you can find existing companies with solid reputations who have skin in the electric vehicle game and put your money there. Companies that make computer chips and charging stations will be part of this rising tide. You don't have to forecast the hottest EV of 2023 in order to make a smart investment.

3. Research. You're already on the right track, Bruce. If you have the feeling, "maybe I should be investing in this," the first step is to do research and ask questions. When you worry other investors know something you don't, see if you can do a little sleuthing and find out what they know. Either you'll decide electric vehicle investing isn't your cup of tea, or you'll discover a company you fall in love with and become a happy shareholder. Don't fall victim to the belief that there's some magic trick to investing-find companies you like and go from there.