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Top 10 Alternative Energy ETFs

 

Our goal in this profile is to help investors wade through the many competing ETF offerings available. Using our long experience as an ETF publication, we can help select those ETFs that matter and may not be repetitive. The result is a more manageable list of issues from which to choose from. 

There are currently less than 20 ETFs oriented to the alternative energy sector. Many are struggling to gain AUM (Assets under Management) and performance success. Some may not succeed as new technologies come and go. Previously nuclear energy held great promise until the Fukushima plant disaster despite its age and unique circumstances blunted growth in the sector.

The energy sector remains volatile and politically controversial given the recent higher spikes in prices in 2008 and 2011. The struggle to move away from carbon based energy sources seems now and again promising, but then not. Any success will take years and decades to achieve success. This adds to the risks of investing in the sector. As a result you'll note AUM are lower in the sector and performance has been less than conventional energy ETFs.

The following analysis features a fair representation of ETFs available. We believe from these, investors may choose an appropriate ETF to satisfy the best index-based offerings individuals and financial advisors may utilize.

We're not ranking these ETFs favoring one over another so don't let the listing order mislead you. Although we may use some of these in ETF Digest portfolios it's not our intention to recommend one over another.

ETFs are based on indices tied to well-known index providers including Russell, S&P, Barclays, MSCI, Dow Jones and so forth. Also included are some so-called "enhanced" indexes that attempt to achieve better performance through more active management of the index.

Where competitive issues exist and/or repetitive issues available at a superior fee cost saving we mention those as other choices.


PBW (PowerShares WilderHill Clean Energy ETF) is based on the WilderHill Energy Index. It seeks to focus on green energy technologies generally from renewable sources of energy. It was launched March 2005 and I was pleased to interview Professor Wilder then. It is the oldest of the alternative energy ETF issues. The expense ratio is .60%. AUM (Assets under Management) equal $468M and average daily trading volume is around 345K shares. As of July 1, 2011 the dividend is negligible and YTD performance is -12.51%.

Data as of June 2011

PBW Top Ten Holdings & Weightings

  1. SunPower Corporation (SPWRA):  2.71%
  2. Molycorp, Inc. (MCP): 2.65%
  3. Ameresco, Inc. (AMRC): 2.45%
  4. Tesla Motors, Inc. (TSLA):  2.38%
  5. Rare Element Resources Ltd. (REE): 2.38%
  6. Amerigon, Inc. (ARGN): 2.33%
  7. Fuel Systems Solutions, Inc. (FSYS):  2.33%
  8. Sociedad Quimica Y Minera De Chile SA ADR (SQM):  2.27%
  9. Rubicon Technology, Inc. (RBCN):  2.22%
  10. Polypore International, Inc. (PPO):  2.17%

 

PUW (PowerShares WilderHill Progressive Energy ETF) follows the WilderHill Progressive Energy Index which includes issues found within PBW but adds some fossil fuel bridge technologies aimed at cleaner use of these fuels. Additionally, some nuclear issues have been included. The issue was launched October 2006. The expense ratio is .60%. AUM equal 67M with average daily trading volume around 14K shares. Through July 1, 2011 the annual dividend is $.23 making the yield .82% and YTD return of 1.52%.

Data as of 2011-06-03

PUW Top Ten Holdings

  1. Westport Innovations (WPRT):  2.64%
  2. Rockwood Holdings, Inc. (ROC):  2.37%
  3. Clean Energy Fuels Corporation (CLNE):  2.33%
  4. GrafTech International, Inc. (GTI):  2.32%
  5. Hexcel Corporation (HXL):  2.26%
  6. Altra Holdings, Inc. (AIMC):  2.23%
  7. General Cable Corporation (BGC):  2.23%
  8. Siemens AG ADR (SI):  2.23%
  9. Owens-Corning, Inc. (OC):  2.20%
  10. Energizer Holdings, Inc. (ENR):  2.20%

 

PBD (PowerShares Global Clean Energy ETF) follows the WilderHill Global Innovation Index which is distinguished marginally by an exposure to companies with technologies facilitating cleaner energy. The fund was launched June 2007. The expense ratio is .75%. AUM equal $143M and average daily trading volume is around 52K shares. As of July 2011 the annual dividend was $.08 with the yield .55% and YTD return of -.79%.

 

Data as of June 2011

PBD Top Ten Holdings & Weightings

  1. Enel Green Power S.p.A. (EGPW):  1.95%
  2. Energy Development (EDC) Corporation:  1.90%
  3. Contact Energy Limited (CEN-NZ):  1.86%
  4. SunPower Corporation (SPWRA):  1.83%
  5. GCL-Poly Energy Holdings Limited (03800):  1.76%
  6. Verbund AG (VER):  1.72%
  7. Tesla Motors, Inc. (TSLA):  1.68%
  8. Ormat Technologies, Inc. (ORA):  1.68%
  9. Meyer Burger Technology AG (MBTN):  1.65%
  10. Edf Energies Nouvelles (EEN):  1.55%

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