As our economy is going on a downturn, many people are investing in stable stocks and ETFs. One of the ETFs available that have been performing very well despite the downturn of the economy is energy ETFs. We all know that even if industrial and manufacturing activities are down, energy has become a necessity and everybody is still using it. If our economy does improve, we can also be sure that energy consumption will go up. So, investing in energy ETFs is a very good idea.
The investing class of the energy ETF includes companies that are involved in the production of energy. This also includes companies that discover and extract energy sources. Energy ETF also includes companies that develop alternative and renewable energy sources. Oil and gas are considered as commodities and are not included in energy ETF. Alternative and renewable energy ETFs were considered gambles in the past, but not anymore, as there is a clear direction for change from the traditional use of oil and gas.
Energy ETFs from companies that explore, discover, and drill for oil and natural gas have always been around. They are stable and would give you profit over time. But because of the several oil spill accidents lately, not to mention the gulf of Mexico BP accident and the biggest oil spill in human history, compounded by the moratorium on oil exploration of the Obama administration, this ETF has been loosing popularity.
The first available renewable energy ETF would be solar energy. Solar energy has been slowly developing into a more dependable source of energy through the decades; hence, its ETF and stocks have slowly been becoming more attractive and more stable. It used to be that stocks and solar energy ETFs were only available from the company itself, but now they are available through stockbrokers and are now widely available to everyone. It can also be traded from one portfolio to another.
Another energy ETF available would be nuclear power energy but because of the fear of accidents and the disposal of nuclear waste, many people are staying away from it.
Wind energy is also gaining a lot of popularity. This is because wind is always available, whether it be day or night. There are even locations where it is windy 24 hours a day. It is also a fact that when a wind turbine has been put in place, it is only a matter of time before it reaches its return of investment. For this reason, wind energy ETF and stocks seem to be the best choice amongst the energy ETFs available.
Source: FinancialPlanningTips.net
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