December 8, 2023

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The plight of renewable energy funds and ETFs: -20% in 2023 (and they lose money in 3 years)

The plight of renewable energy funds and ETFs: -20% in 2023 (and they lose money in 3 years)

the Renewable energy investment funds They suffer (a lot) in the stock market. These funds, which mainly invest in energy-related companies such as solar, hydropower, wind and nuclear, saw an average decline of more than 20% in 2023, according to the data we have in Finect’s mutual fund categories classification. com.

Some of the mutual funds in the category that suffered the most losses this year are BNP Paribas finances the energy transition (-34.47%), Luxembourg Active Solar Select Box (-32.86%), Quaero Capital Funds (LUX) – Accessible clean energy (-26.34%) or Goldman Sachs Global Clean Energy Infrastructure Equity Portfolio (-22.48%).

After 3 years they lose money too

The alternative energy mutual fund sector had a particularly tough year in 2023. But the decline isn’t just consistent with this year. The fund class’s 3-year absolute return is -7.56% and the annualized return is -2.59%. that it In the past three years, clean energy investors have lost more than 2.5% per year on average of their money.

Since the sector experienced its post-Covid-19 moment in 2020 and the beginning of 2021, sector funds and ETFs have persisted. High interest rates have crushed many alternative energy companies Further growth, depends largely on the financing conditions of their projects.

The downfall he also shares Alternative energy ETFs: These ETFs are also down more than 20% on average The Most Expensive ETF Category of 2023.

Alternative energy funds 22 -1.99% -20.64% -27.48% -2.01% +13.15% +7.30%
Alternative energy ETFs 18 -2.09% -20.04% -27.37% -2.59% +12.41% +7.28%

This decline can be seen in more detail by taking a look at the S&P Global Clean Energy Index, which is the most popular index when it comes to measuring the performance of renewable energy companies. This indicator decreases this year by more than evidenced by this associated ETF.

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