NEW YORK (TheStreet) -- Exchange traded securities tied to the price of natural gas are leaking shareholder value.
iPath Dow Jones-UBS Natural Gas Total Return Sub-Index ETN
, the worst-performing fund in the five trading days through Aug. 13, flamed off 7.6% of its market value. The exchange traded fund that tracks the performance of Henry Hub natural gas futures contracts,
United States Natural Gas Fund LP
, lost 5.5% of its value. Henry Hub natural gas dropped 12% during that time.
Low price for gas is dissuading utilities from converting to more environmentally friendly and more expensive solar and wind power. Five of the worst-performing funds focus on clean-energy companies.
Leading the pack lower was the
Market Vectors Solar Energy ETF
, which declined 4.9%.
JA Solar Holdings
, two holdings, each recorded declines of 21% after disappointing investors with quarterly losses. Other solar positions include
, off 14%;
Solarfun Power Holdings
( SOLF), also down 14%; and
GT Solar International
( SOLR), off 12%.
For the week ending Thursday, Aug. 13, the average energy sector fund inched up 1.1%, excluding inverse funds.
Some of the best performers were closed-end funds specializing in master limited partnerships, or MLPs, which collect oil and gas pipeline and other energy royalties. Most of the 7% increase in the value of the
Tortoise North American Energy
closed-end fund wasn't associated with its holdings but rather with shrinkage in the discount at which the fund trades in comparison to its net asset value.
The second-best-performing energy fund is one of two that hoards coal stocks. The
PowerShares Global Coal Portfolio
( PKOL) added 6.4% for the five trading days under review. With half of U.S. electricity generation coming from the burning of coal, the expected economic recovery can only be good for coal stocks.
Double-digit gainers include 16% in
Alpha Natural Resources
, 13% in
( PCX) and 12% in
Unlike natural gas, coal is easy to transport. Consol Energy reported the sale of 88,000 tons of U.S. mined steel-making coal to a buyer in China. As China continues its economic stimulus and imports more coal, demand for this fuel and the companies that mine it may allow investors who get in early to clean up.
Kevin Baker became the senior financial analyst for TSC Ratings upon the August 2006 acquisition of Weiss Ratings by TheStreet.com, covering mutual funds. He joined the Weiss Group in 1997 as a banking and brokerage analyst. In 1999, he created the Weiss Group's first ratings to gauge the level of risk in U.S. equities. Baker received a B.S. degree in management from Rensselaer Polytechnic Institute and an M.B.A. with a finance specialization from Nova Southeastern University.