Alternative Energy ETFs Shine This Week

By Tom Lydon | June 19, 2008 | 6:39 PM | 0 Comments

It wasn't the best week, as the Dow briefly dipped back below the 12,000 point on Wednesday before recovering slightly. It's now sitting just a little bit above that - and what will Friday bring? By and large, they haven't been the best day for the markets so far this year.

But even on a week like this one, there were some standout ETFs. In the last five days, there have been some strong performers, giving hints as to what investors are thinking about. Technology, clean energy and commodities were on top:

Internet HOLDRs (AMEX: HHH), up 12.2% in the last five days

Market Vectors Alternative Global Energy (AMEX: GEX), up 8.4%

First Trust NASDAQ Clean Edge U.S. Liquid (NSDQ: QCLN), up 7.3&

ProShares Ultra Semiconductors (AMEX: USD), up 7.3%

SPDR Metals & Mining (AMEX: XME), up 7.1%

Most notable are the two alternative/clean energy funds that are at the top of the list. Between ongoing fears of global warming and oil getting more and more expensive, the alternative energy sector is getting a nice push.

The newest member of the alt-energy family is launched on Wednesday, this time harnessing the power of wind: the First Trust ISE Global Wind Energy Index Fund (NYSE: FAN). Its underlying index is made up of companies around the world that are active in the wind energy industry. The minimum market cap for a company in the index is $100 million.

Wind energy is currently supplying enough electricity annually in the United States to power more than 4.5 million homes. While that sounds like a lot, less than 1% of the nation's electricity is currently supplied by wind power, according to the American Wind Energy Association. In Europe, Denmark gets more than 20% of its power from wind. In 2007, Germany received about 7% of its power from wind.

In the United States, the winds in North Dakota alone could supply about one-third of the nation's electricity, but there are adequate winds for commercial power production at various sites in 46 states.

The other wind energy fund expected sometime soon is the PowerShares Global Wind Energy Portfolio.