Alternative, clean energy-related exchange traded funds are weathering the storm as the slide in oil prices and Tesla Motors (NasdaqGS: TSLA) pressure the go-green mindset.
As oil priced declined, with West Texas Intermediate and Brent crude oil futures pushing bellow $50 per barrel, the market is deliberating on the competitive advantage of clean technology over cheap energy.
For instance, Elon Musk’s Tesla Motors (NasdaqGS: TSLA) has dropped 18.8% over the past three months while Solar City (NasdaqGS: SCTY) declined 9.9%.
Meanwhile, the Guggenheim Solar ETF (NYSEArca: TAN), which includes 9.1% position in SCTY, has dipped 11.7% over the past three months. [As Oil Tumbles, Clouds Gather for Solar ETFs]
Broader alternative energy ETFs, which include solar energy along with other sub-sector exposures, have been slightly better off. The Market Vectors Global Alternative Energy ETF (NYSEArca: GEX), which has a 10.5% position in TSLA, was down 4.6% over the past three months while the First Trust NASDAQ Clean Edge Green Energy Index Fund (NasdaqGS: QCLN), which has a 7.2% weight in TSLA, was 6.5% lower. [Cheap Oil Saps Tesla, Alternative Energy ETFs’ Vigor]
Despite the fall-off in energy prices, clean energy investments rose for the first time in three years over 2014, with wind, solar, biofuels and other low-carbon energy technologies attracting $310 billion last year, a 16% gain year-over-year, reports Louise Downing for Bloomberg.
Boosting the appeal for green tech investments, China enacted a 32% expansion in its commitment to renewables and added a record $19.4 billion investment into offshore wind projects.