The Roen Financial Report released its monthly ranking of alternative energy Mutual Funds (MFs) and Exchange Traded Funds (ETFs). The latest update produced a shift in many of the MF ranks, bringing Allianz RCM Global Water A (AWTAX) and Fidelity Select Environment and Alternative Energy (FSLEX) to the top of the list.
New Alternatives (NALFX) lost its uppermost slot this month, dropping from a Rank 1 to a Rank 2. This is primarily due to less favorable price/earnings ratios in the stocks that it holds. On the other side, AWTAX and FSLEX have been elevated to Rank 1 status because of their improving statistics. AWTAX got top marks due to its low relative risk, superior price/sales ratios and low turnover. FSLEX has had excellent returns, has low underlying price sales and price earnings ratios, and offers extremely low management fees.
Firsthand Alternative Energy (ALTEX) dropped to a Rank 5, primarily due to poor returns, high capital gains exposure for shareholders, and above normal management fees.
On October 19, 2012, the Winslow Green Growth Fund (WGGFX) was reorganized into the Brown Advisory Winslow Sustainability Fund (BAWAX). This new fund will be guided by the same environmental principles that steered the Winslow Green Growth Fund, and will be managed by the same investment team. As a result of this recent change, however, data is lacking for many of the funds metrics, but the numbers should be available by the next round of ranking.
All Rank 1 ETFs remain the same for November: Market Vectors Environmental Services (EVX), First Trust ISE Global Wind Energy Index Fund (FAN) and First Trust ISE-Revere Natural Gas Index Fund (FCG). Each of these funds excels for various reasons, but they all share a low management fee structure relative to the other ETFs. Both Market Vectors Solar Energy (KWT) and PowerShares WilderHill Clean Energy Portfolio (PBW) got bumped up a notch in their ranks, and both are considered to be trading at below fair value when measuring the prices of their underlying securities.
Remember to always consult with your investment professional before making important financial decisions.