Not everyone is sold on environmentalism, but it's hard to argue with the returns of some mutual funds that invest in "green" companies. The recent performance of the (AECOX) Allianz RCM Global EcoTrends Fund (AECOX) should convert skeptics faster than a code-red air-quality alert.

The $131 million fund has appeared in the top 10% of stock funds for several months this year. It advanced 28.13% in the six months through August, smartly outperforming the 5.71% total return of the

S&P 500

over the same period.

Even more impressive, the fund turned in a very respectable 4.26% return for the three months ended Aug. 31, compared with a 3.28% decline in the S&P 500.

Since inception in January of this year, it is up 19.3%.

Global EcoTrends isn't the only "green" fund generating attractive returns, but it is more diversified than most of its cohorts. Other recent ecological standouts focus on a single industry, such as

clean energy or

clean water.

Allianz's fund invests in both of these areas; its "eco energy" investments include renewable energy -- such as wind, solar and geothermal -- in addition to firms involved in energy efficiency, "microgeneration" of electricity and hybrid cars.

In clean water, the fund focuses on infrastructure solution investments, such as pipes, pumps and valves, desalination plants and companies involved in water-purification technologies, such as filtration systems, ozone and ultraviolet treatments.

Global EcoTrends also invests in companies involved in pollution control, including air-filter manufacturing, air-cleaning services and recycling technologies.

Also differentiating the Global EcoTrends fund from most other green offerings is the global scope of its portfolio: More than 70% of holdings are firms domiciled outside the U.S.

The fund's largest holdings, as of July 31, were Norway's

Renewable Energy

, Spain's

Gamesa Corp Techno

, Denmark's

Vestas Wind Systems

,

Suntech Power Holdings

(STP)

,

First Solar

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(FSLR) - Get Report

, Germany's

Q Cells

,

Stericycle

(SRCL) - Get Report

, Germany's

Conergy

, Spain's

Abengoa

and Denmark's

Novozymes

.

It has an expense ratio of 1.81%.

The fund's structure is also somewhat unusual. It's what is known as a closed-end "interval fund." Shares may be purchased from the sponsor at any time, in this case with a maximum front-end sales commission of 4.5%.

However, unlike ordinary closed-end funds, they aren't traded on an exchange. And unlike open-end funds, shares can't be redeemed at will. Instead, the fund's management company offers to repurchase a limited amount of shares each quarter at net asset value.

This gives the managers more leeway to invest in illiquid stocks, since they don't have to worry about keeping cash on hand at all times to meet redemptions. Ordinary closed-end funds offer the same benefit, but they tend to trade at a discount to net asset value.

With giant corporations such as

General Electric

(GE) - Get Report

and

BP

(BP) - Get Report

declaring allegiance to the green revolution, this small fund has ample opportunity to continue its early success.

Richard Widows is a financial analyst for TheStreet.com Ratings. Prior to joining TheStreet.com, Widows was senior product manager for quantitative analytics at Thomson Financial. After receiving an M.B.A. from Santa Clara University in California, his career included development of investment information systems at data firms, including the Lipper division of Reuters. His international experience includes assignments in the U.K. and East Asia.