“The industry was shaken in January of last year after the U.S. imposed a 30% tariff on foreign-made solar panels. But it has basically recovered, at least in terms of the industry group’s price performance,” according to IBD.
Related: Solar ETF Shines on Optimistic 2019 Outlook
Investors should note the average market value of TAN’s holdings is $1.41 billion, meaning this is essentially a small-cap fund. About two-thirds of TAN’s components are classified as small-cap stocks. Higher oil prices are also contributing to TAN’s rally.
“One reason for the ETF’s success is that solar energy stocks often follow the price of crude oil. U.S. crude prices are up more than 30% from a December low. But the fund’s strength is mainly in its Chinese holdings,” reports IBD.
For more information on the thematic ETF investing strategies, visit our Thematic Investing Channel.