Looking for green investments? Eco-friendly ETFs can diversify your portfolio and even help the environment.
The US has come along way since the oil crisis in 1973. Back then, the Organization of the Petroleum Exporting Countries (OPEC) declared an embargo on all exports of oil to the US.
And even though that one event lasted just a few months, over the following years the US has dealt with volatile oil prices and increasing demand from consumers. Not to mention the elephant in the room – climate change.
Read more: Responsible Investing: Is Your Portfolio Melting the Polar Caps?
Now we could tell you to swap your car for a bicycle, only buy and eat locally produced food, and never fly off to Hawaii again. But we’re here to give you investing ideas, so let’s consider a topic we don’t cover very often: exchange traded funds.
ETFs for short, these funds give investors exposure to a range of equities – in our case mostly stocks – without purchasing them individually. Similar to an index, an ETF can track a particular set of stocks. And ETFs typically come with associated fees and expenses that are cheaper than more traditional mutual funds.
For the list below, we gathered ETFs that relate to green investing in some way, including:
– Clean energy sources like wind and solar power
– Clean technology like smarter power grids
– Environmental services companies
To help investors differentiate between these options, we ranked them starting with the best performer over the last quarter. Quarterly performance above 20% is typically seen as a sign of outperforming the market.
Click on the interactive chart below to see data for our top three performing green ETFs over time.
Do you consider the environment when selecting ETFs? Use the list below as a starting point for your own analysis.
1. Guggenheim Solar ETF (TAN, Earnings, Analysts, Financials): Seeks investment results that correspond generally to the performance, before the Fund’s fees and expenses, of an equity index called the MAC Global Solar Energy Index. Market cap at $293.1M, most recent closing price at $37.35.
Performance over the last quarter: 34.94%.
2. Market Vectors Solar Energy (ETF) (KWT, Earnings, Analysts, Financials): Seeks to normally invest at least 80% of its total assets in equity securities, which may include depositary receipts, of U.S. and foreign companies primarily engaged in the production and distribution of solar power. Market cap at $21.0M, most recent closing price at $70.00.
Performance over the last quarter: 27.58%.
3. First Trust Global Wind Energy (ETF) (FAN, Earnings, Analysts, Financials): Seeks investment results that correspond generally to the price and yield of the ISE Global Wind Energy Index. Market cap at $68.1M, most recent closing price at $10.89.
Performance over the last quarter: 23.41%.
4. PowerShares Glbl Clean Enrgy Port (ETF) (PBD, Earnings, Analysts, Financials): Seeks investment results that correspond generally to the price and yield of the ISE Global Wind Energy Index. Market cap at $68.1M, most recent closing price at $10.89.
Performance over the last quarter: 23.41%.
5. iShares S&P Global Clean Energy Index Fd (ICLN, Earnings, Analysts, Financials): Seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the S&P Global Clean Energy Index. Market cap at $44.8M, most recent closing price at $10.66.
Performance over the last quarter: 14.67%.
6. Market Vectors Glbl Alter. Engy ETF Trst (GEX, Earnings, Analysts, Financials): Seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the Ardour Global IndexSM-(Extra Liquid). Market cap at $94.2M, most recent closing price at $56.00.
Performance over the last quarter: 12.66%.
7. PowerShares WilderHill Clean Energy(ETF) (PBW, Earnings, Analysts, Financials): Seeks investment results that correspond generally to the price and yield of an equity index called the WilderHill Clean Energy Index by investing at least 80% of its total assets in common stocks of companies engaged in the business of the advancement of cleaner energy and conservation. Market cap at $216.5M, most recent closing price at $6.63.
Performance over the last quarter: 11.9%.
8. PowerShares Cleantech Portfolio (ETF) (PZD, Earnings, Analysts, Financials): Seeks investment results that correspond to the Cleantech Index. The Fund will normally invest at least 80% of its total assets in common stocks of cleantech companies. Market cap at $76.2M, most recent closing price at $29.30.
Performance over the last quarter: 9.23%.
9. First Trust NASDAQ Clean Edge US (ETF) (QCLN, Earnings, Analysts, Financials): Seeks investment results that correspond generally to the price and yield of an equity index called the NASDAQ Clean Edge U.S. Liquid Series Index. Market cap at $32.0M, most recent closing price at $17.30.
Performance over the last quarter: 8.89%.
10. Market Vectors Environmental Service ETF (EVX, Earnings, Analysts, Financials): Seeks to replicate as closely as possible the price and yield performance of the Amex Environmental Services Index. Market cap at $19.1M, most recent closing price at $63.57.
Performance over the last quarter: 6.79%.
11. First Trust NASDAQ Clean Edge (GRID, Earnings, Analysts, Financials): Seeks investment results that correspond generally to the price and yield of the NASDAQ OMX Clean Edge Smart Grid Infrastructure Index. Market cap at $12.2M, most recent closing price at $34.74.
Performance over the last quarter: 5.52%.
(List compiled by Emily Smykal. Price data sourced from Zacks Investment Research, all other data sourced from Finviz.)
Analyze These Ideas: Getting Started
– Read descriptions for all companies mentioned
– Access a performance overview for all stocks in the list.
Dig Deeper: Access Fund Snapshots, Charts, Filings
– Guggenheim Solar (TAN, Chart, Download SEC Filings)
– Market Vectors Solar Energy ETF (KWT, Chart, Download SEC Filings)
– First Trust Global Wind Energy (FAN, Chart, Download SEC Filings)
– PowerShares Global Clean Energy (PBD, Chart, Download SEC Filings)
– iShares S&P Global Clean Energy Index (ICLN, Chart, Download SEC Filings)
– Market Vectors Glb Alternatve Energy ETF (GEX, Chart, Download SEC Filings)
– PowerShares WilderHill Clean Energy (PBW, Chart, Download SEC Filings)
– PowerShares Cleantech (PZD, Chart, Download SEC Filings)
– First Trust NASDAQ Cln Edg Green En Idx (QCLN, Chart, Download SEC Filings)
– Market Vectors Environmental Svcs ETF (EVX, Chart, Download SEC Filings)
– First Trust NASDAQ Cln Edge Smrt Grd Inf (GRID, Chart, Download SEC Filings)
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