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Following Buffett's Lead in Wind Energy

NEW YORK ( TheStreet) - Warren Buffett's recent exposure to the wind energy industry has taken center stage and stolen headlines. Using ETFs, investors can follow Buffett's lead and gain exposure to companies which work to harness and profit from the power of wind.

Energy is not a new venture for Buffett. On the contrary, through a number of his investments and subsidiaries, Warren Buffett has expanded his investment reach into various corners of the energy industry. Boasting exposure to companies including Exxon Mobil (XOM - Get Report), ConocoPhillips (COP - Get Report) and Burlington Northern Santa Fe Railroad, the famous investor has for years held direct and indirect exposure to various traditional fuel sources, including oil and coal.

The alternative energy industry is not excluded from Buffett's portfolio, either. Well known components of the Buffett's Berkshire Hathaway (BRK.A - Get Report) portfolio, including General Electric (GE - Get Report) and BYD have been major players in the growth of clean tech and energy industries such as wind, solar, and battery power in recent years

MidAmerican Energy Holdings, a notable subsidiary of Berkshire Hathaway, has also been steadily increasing its stake in the alternative energy picture. Recently, the firm unveiled its massive plan to further step up its wind presence by installing nearly 600 megawatts of wind power in Iowa.

The energy created by the more 250 turbines will be enough to power 190,000 homes. According to a MidAmerican spokesperson, when the installation of the turbines is complete, the percentage of the company's capacity that comes from wind will stand at 25%.

Today, there are a number of ETF products available which seek access individual components of the alternative energy spectrum from a pure-play perspective. For instance, investors looking for concentrated exposure to the wind energy industry can turn to a fund such as the First Trust ISE Global Wind Energy ETF (FAN).

However, rather than using such a concentrated fund to fulfill demand for alternative energy, conservative investors may find a product like the PowerShares Wilderhill Clean Energy Portfolio (PBW) more to their liking.

As we have seen over the past year, it is not uncommon to see heavily concentrated alternative energy funds such as FAN and Guggenheim Solar ETF (TAN) see dramatic day-to-day swings. In an attempt to tone down the volatility of these industries, PBW's assets are spread across a number of different facets of the clean energy sector.
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PBW $4.03 -1.70%
FAN $11.69 -2.83%
BRK.A $217,020.00 -1.50%
COP $45.06 -3.80%
GE $30.61 -0.91%


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