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Max Manturov

Max Manturov

Head of investment research regulated by CySec 29.10.2021

How to invest wisely in the green energy sector: the top 4 ETFs

In mid-September 2021, many countries began to face an energy crisis, with the situation continuing to deteriorate in October. European countries, China, India and the UK are among those affected. The EU finds itself in the most difficult situation, as it remains heavily dependent on gas and oil prices.

The energy crisis in Europe was caused by a number of simultaneous factors. The most significant of these are:

  • the switch to renewable and clean energy sources and the phasing out of carbon sources
  • weather conditions (cold winters and hot summers)
  • a high demand for LNG from Asia

The consequence was a more than tenfold surge in gas prices. This surge was also reflected in other fuel resources: prices for both Brent and WTI oil exceeded $80 a barrel.

The current situation of high carbon energy prices will encourage a further shift to alternative energy sources, especially in the affected countries. Therefore, substantial investments will continue to flow into "green" and nuclear energy.

In May this year, our team of analysts already presented several ETFs consisting of renewable energy company stocks. Since then, they have seen returns of between 10% and 23%. Investing in these ETFs is still relevant - see below for more details.

In addition there is an ETF with an allocation to companies in the nuclear energy sector, although this asset is more volatile and carries greater risks due to the low size of assets under management and low diversification.

iShares Global Clean Energy ETF

Ticker: ICLN.US

Current price: $24.98

Assets under management, AUM: $6.49 billion

Dividend yield: 0.71%

Expense Ratio: 0.42%.

The number of names in the ETF: 77.

Companies with the largest allocation to ETFs:

  • Vestas Wind Systems A/S - 8.19%
  • Orsted - 5.59%)
  • Enphase Energy Inc. - 7.34%
  • Plug Power - 5.48%
  • Consolidated Edison - 5.37%

The largest shares of allocation by country were USA (35%), Denmark (13.8%) and Spain (8.1%).

The largest share of allocation by sector is Utilities (47.9%).

The average P/E Ratio for the portfolio is 25.8x.

The ETF's year-to-date return is (-12.9%).

Read more about this ETF at KID.


Invesco Solar ETF

Ticker: TAN.US

Current price: $95.39

Assets under management, AUM: $3.51 billion

Dividend yield: 0.10%

Expense Ratio - 0.69%

The number of names in the ETF is 46.

Companies with the largest allocation to ETFs:

  • Enphase Energy Inc. - 10.27%
  • SolarEdge Technologies - 10.95%
  • Sunrun Inc. - 7.26%
  • First Solar Inc. - 7.06%
  • Xinyi Solar Holdings Ltd. - 6.58%

The largest shares of allocation by country - USA (40.16%), China (17.96%), Israel (14.53%).

The largest allocations by sectors are Electronic Technologies (33.13%), Utilities (27.99%) and Producer Manufacturing (22.95%).

The average P/E Ratio across the portfolio is 69.9x.

The ETF's year-to-date return is (-8.34%).

Read more about this ETF at KID


First Trust NASDAQ Clean Edge Green Energy Index Fund

Ticker: QCLN.US.

Current price: $74.31.

Assets under management, AUM: $2.86 billion

Dividend yield: 0.11%

Expense Ratio - 0.60%

The number of names in the ETF is 61.

Companies with the largest allocation to ETFs:

  • Tesla Inc. - 10.22%
  • NIO Inc. - 7.71%
  • Enphase Energy Inc. - 7.33%
  • Albemarle Corporation - 7.33%
  • ON Semiconductor Corporation - 5.21%

The largest shares of allocation by country - USA (73.8%), China (14.11%), Israel (3.95%).

The largest allocations by sector are Electronic Technologies (33.4%), Consumer Durables (23.2%) and Producer Manufacturing (13.7%).

The average P/E Ratio of the portfolio is 31.8x.

The ETF's year-to-date yield is 3.35%.

Read more about this ETF at KID.

VanEck Uranium + Nuclear Energy ETF

Ticker: NLR.US

Current price: $56.

Assets under management, AUM: $30.8 million

Dividend yield: 1.93%

Expense Ratio - 0.61%

The number of names in the ETF is 26.

Companies with the largest allocation to ETFs:

  • Dominion Energy Inc. - 7.59%
  • Duke Energy Corporation - 7.54%)
  • Exelon Corporation - 6.92%
  • Public Service Enterprise Group Inc. - 6.26%
  • PG&E Corporation - 6.04%

The largest share of allocation by country - USA (49.61%), Japan (11.51%), Canada (8.83%).

Utilities (85.78%), Non-Energy Minerals (14.13%) are the largest allocations by sectors.

Average P/E Ratio of the portfolio is 14.97x.

The ETF's year-to-date yield is 14.25%.

Read more about this ETF at KID.


How to Buy ETFs?

If you don't have an investment account yet, open it now: this can be done online, in just 10 minutes. All you need to do is fill out a short form and verify your account.

After opening an account, you can buy ETFs in either of the following ways:

Freedom24 Web Platform: In the Web Terminal section, type in the search box, and select the appropriate ETF in the results. Open a secure session in the trading window on the right, select the number of securities you want to buy, and click Buy.

Freedom24 iPhone or Android App: Go to the Price screen and tab the search icon in the top right corner. In the search dialog that will show up, type and select the appropriate ETF in the results. You will then see the ETF in the market watch; tap it and go to the Order tab in the dialog that shows up. Specify the number of securities you want to buy and click Buy.


Go to Freedom24 web platform >>


*Additional information is available upon request. Investment in securities and other financial instruments always involves risks of capital loss. The Client should make himself aware at his own accord, including to familiarize himself with Risk Disclosure Notice. Opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice. Commissions, fees or other charges can diminish financial returns. Past performance is not indicative of future results. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The opinions and recommendations herein do not take into account individual client circumstances, objectives, or needs and do not constitute an investment advice service. The recipient of this report must make their own independent decisions regarding any securities or financial instruments mentioned herein. Information has been obtained from sources believed to be reliable by Freedom Finance Europe Ltd. or its affiliates and/or subsidiaries (collectively Freedom Finance). Freedom Finance Europe Ltd. do not warrant its completeness or accuracy except with respect to any disclosures relative to the Freedom Finance Europe and/or its affiliates and the analyst’s involvement with the issuer that is the subject of the research. All pricing is indicative as of the close of market for the securities discussed, unless otherwise stated.



  • Sources of information

    https://www.ishares.com/us/products/239738/ishares-global-clean-energy-etf?qt=ICLN

    https://www.invesco.com/us/financial-products/etfs/product-detail?audienceType=Investor&ticker=TAN

    https://www.ftportfolios.com/retail/ETF/ETFsummary.aspx?Ticker=QCLN

    https://www.vaneck.com/us/en/investments/uranium-nuclear-energy-etf-nlr/?redirectVE=1&orig=http://www.vaneck.com/index.cfm?cat%3d3192&cGroup=ETF&LN=3-02,3_02&tkr=NLR

  • Recommendation evaluation methodology according to Market Research Terms of Use
    Freedom Finance analysts perform a three-stage analysis. They select a promising industry based on the latest news, statistics and industry-specific metrics. They assess the supply and demand situation and its future development dynamics. Industry’s investment attractiveness is mostly affected by the forecasted market growth rates; total addressable market, player concentration level and likeliness of a monopoly formation, as well as the level of regulation by various entities or associations.

    The assessment is followed by the comparative analysis based on the selected sample. The sample comprises companies with a market capitalization of over USD 1 billion, but there is space for exceptions (when the suitable level of liquidity for company’s securities is available on the stock exchange). The selected companies (peers) are being compared against each other based on multipliers (EV/S, EV/EBITDA, PE, P/FCF, P/B), revenue growth rates, marginality and profitability (operating income margin, net income margin, ROE, ROA), and business performance.

    Having completed the comparative analysis, the analysts carry out a more in-depth research of the news about the selected company. They review company’s development policy, information about its current and potential mergers and acquisitions (M&A activity), and assess the efficiency of company's inorganic growth and other news about it over the past year. The main objective at this stage is to identify the growth drivers and evaluate their stability, as well as the extent of impact they have on the business.

    Based on all the data collected, the analysts determine the weighted forecasted figures of company’s growth rates and proposed business marginality, which are used to calculate the company’s multiplier-based estimated value. The said value enables setting the stock price target and stock value growth potential.

    The expected timing of the idea implementation is set depending on the current market situation, volatility level and available forecasting horizon for industry and company development. The forecasting period is normally set between 3 and 12 months.