Exchange traded funds (ETFs) are a diversified play on clean energy companies, and in this stage of development, the sector still has its ups and downs. Once the supply and demand factors play out, will these funds get the activity they deserve?
Alternative energy is an exciting sector. It’s full of young, dynamic companies working hard to shape the world’s energy future. Money and Markets reports that investing in single stocks from this sector is high-risk – not every company can be a success story. There lies an inherent benefit of ETFs: play them all and spread out your risk. But the question is are they bargain-priced now or are they still falling?
Keith Bradsher for The New York Times reports that a broad trade case filed on Thursday by an American labor union, accusing China of unfairly subsidizing its clean energy industry, may stunt the clean energy sector’s growth for the time being. The filing accuses China of violating the World Trade Organization’s free-trade rules by subsidizing exports of clean energy equipment like solar panels and wind turbines. [The Powerful Source Behind Clean Energy ETFs.]
The argument rests in that China has helped turn its makers of that equipment into the global leaders, while manufacturers in the United States and Europe have struggled financially, and some have evens outsourced to China. [The Promise Behind Green ETFs.]
According to CleanTech Blog, energy efficiency is in demand across the spectrum: green building activity has surged, more fuel efficient vehicles populate the roads and the investment community is on board, pouring billions into the sector.
For more stories about alternative energy, visit our green ETF category. In order to pick your spots in the green energy sector, look for what’s trending higher and above its 200-day moving average. Unfortunately, many of the funds that dot this space are well below those long-term trend lines. Sign up for alerts and you’ll get notified by email when green ETFs enter potential long-term uptrends.
- Market Vectors Solar Energy (NYSEArca: KWT)
- PowerShares Cleantech Portfolio (NYSEArca: PZD)
- iShares S&P Global Clean Energy Index Fund (NYSEArca: ICLN)
- Market Vectors Global Alternative Energy (NYSEArca: GEX)
Tisha Guerrero contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.