Core Viewpoint - The ALPS Clean Energy ETF (ACES) has shown a strong return of 38.2% over the past year, but its five-year return is significantly negative at -59.34%, indicating volatility and risk in the clean energy sector [1]. Group 1: ETF Overview - ACES is a thematic growth ETF that targets the entire clean energy ecosystem in North America, with 32% of its portfolio in Industrials and notable exposure to Information Technology, Utilities, Materials, and Consumer Discretionary [1]. - The fund has a 39% annual turnover rate, reflecting a buy-and-hold strategy, and a reasonable expense ratio of 0.55% for a thematic fund [1]. - With net assets of $117.1 million, ACES is considered smaller, which may lead to wider bid-ask spreads during volatile market conditions [1]. Group 2: Performance Analysis - ACES has outperformed the S&P 500's 12.95% return over the past year, driven by a recovery in the clean energy sector following a significant drawdown from 2021 to 2023 [1]. - Year-to-date, ACES is up 9.13%, but it has underperformed compared to the iShares Global Clean Energy ETF, which has gained 15.09% [1]. - The five-year return of -59.34% highlights the challenges faced during the rate-hiking cycle, indicating a need for recovery for long-term investors [1]. Group 3: Market Environment - The current rate environment is favorable, with the Federal Reserve cutting rates three times between September and December 2025, reducing financing costs for renewable projects [1]. - The 10-year Treasury yield is at 4.08%, down 34 basis points year-over-year, which eases valuation pressure on growth holdings [1]. Group 4: Risks and Considerations - The ETF faces policy concentration risk, as its recent momentum is largely tied to clean energy tax credits from the Biden administration, with a looming June 30, 2026 deadline creating both a catalyst and potential cliff [1]. - ACES includes a mix of profitable infrastructure operators and pre-revenue micro-cap companies, leading to significant volatility within the portfolio [1]. - The fund offers minimal income with a dividend yield of 0.46% and a quarterly distribution of $0.0911 per share as of December 2025, providing little cushion during market drawdowns [1].

Core Insights - The demand for clean energy is surging due to the rapid growth of AI infrastructure, with major tech companies investing hundreds of billions annually in AI data centers [1][4] - AI data centers require massive amounts of electricity, leading to increased demand for clean energy sources [2][3] - The iShares Global Clean Energy ETF has seen a significant increase of 66% over the past year, outperforming major indices and oil companies, indicating strong investor interest in clean energy [4] Investment Landscape - The International Energy Agency (IEA) projects that global electricity demand will rise by at least 40% by 2035, with investment in electricity generation reaching $1 trillion per year, a 70% increase since 2015 [5][6] - Renewable energy, particularly solar power, is expected to play a crucial role in meeting this demand, with solar capacity projected to double from 2025 to 2030 [7] - Off-grid solar systems are becoming increasingly popular, with 42% of solar expansion expected to come from distributed applications [8] ETF Performance and Holdings - The iShares Global Clean Energy ETF has averaged an annual return of negative 8.9% over the past five years, but has rebounded with a 46.6% gain in 2025 and over 10% year-to-date in 2026 [10][11] - The ETF focuses on companies involved in clean energy production, holding 102 stocks, with the top five holdings comprising about 37% of its portfolio [12][13] - Key holdings include Bloom Energy, Nextpower, First Solar, Iberdrola, and China Yangtze Power, which are involved in various aspects of renewable energy generation [15]

Core Insights - Clean energy stocks significantly outperformed artificial intelligence stocks in 2025, with the iShares Global Clean Energy ETF rising by 47%, compared to a 39% return from Nvidia and a 21% increase in the Nasdaq Composite [2][8] - Despite a previous downturn in clean energy stocks, there are indications that the current rally may be more sustainable due to several factors [3][8] Group 1: Market Performance - The iShares Global Clean Energy ETF's 47% increase surpassed the 25% average gain of the "Magnificent Seven" tech stocks associated with the AI boom [2][8] - The clean energy sector has not fully recovered from the 2021 sell-off, raising questions about the sustainability of the recent gains [3] Group 2: Factors Driving Growth - The Trump administration's new legislation has created a surge in short-term demand for renewable energy, requiring companies to start construction on projects by July 1, 2026, to retain tax credits [4][5] - The U.S. is expected to add more clean energy capacity in 2026 than in any previous year, with projections indicating that 2025's record will be surpassed in both 2026 and 2027 [5] - In the first half of 2025, global renewable energy generation exceeded coal for the first time, driven by significant infrastructure investments in India and China [7]

Core Insights - The iShares Global Clean Energy ETF (ICLN US) is based on the S&P Global Clean Energy Transition Index, which focuses on companies involved in renewable power generation and related clean-energy technologies and services [1] Group 1: Index Construction - The index targets companies from both developed and emerging markets engaged in renewable energy activities such as solar, wind, hydro, biomass, and geothermal [1] - Constituents are selected based on exposure scores derived from reported revenue and business descriptions, with minimum exposure required for inclusion [1] - The index employs investability filters that consider minimum float, trading liquidity, and accessibility for foreign listings [1] Group 2: Weighting and Diversification - Constituents are weighted by float-adjusted market capitalization, with single-name caps and thematic diversification controls to avoid concentration in specific sectors like turbines, modules, or utilities [1] - Sustainable business involvement screens are applied to exclude companies engaged in thermal coal and other non-sustainable activities [1] Group 3: Rebalancing - The index undergoes semiannual rebalancing, with updates for interim corporate actions and share/float adjustments [1]

Core Insights - Clean energy stocks have significantly outperformed the global stock market over the past 12 months, with the iShares Global Clean Energy ETF (ICLN) returning nearly 50% since early January 2025 [1] Group 1: Performance Metrics - The iShares Global Clean Energy ETF (ICLN) has achieved a return of nearly 50% since early January 2025 [1] - This performance easily surpasses that of the global stock market during the same period [1]

Core Insights - The article discusses a strategic shift in investment from the iShares Global Clean Energy ETF (ICLN) to Caterpillar Inc. (CAT), highlighting the changing market dynamics and momentum [2][6]. Market Overview - As of 2:00 PM EST, the U.S. market showed positive performance with the S&P 500 up by 1.07%, Nasdaq by 1.37%, and Dow by 1.12%. The 10-year Treasury yields fell below 4%, while the Dollar Index remained stable. WTI crude prices were flat due to oversupply concerns. The rally was led by technology and financial sectors, while defensives and energy lagged. Strong earnings from industrial companies like GM and positive sentiment regarding U.S.-China talks contributed to risk-on flows [5]. Portfolio Strategy - The decision to sell ICLN and purchase CAT reflects a transition from a defensive investment strategy to a more offensive approach aligned with current market trends. ICLN had served as a defensive hedge but showed signs of flow weakness, while CAT demonstrated strong momentum and favorable macroeconomic alignment [2][6][7]. Performance Metrics - The flow score for CAT increased by 6.13, indicating rising investor interest and confidence. The portfolio's adaptability was emphasized by the quick exit from ICLN and immediate reallocation to CAT, maintaining a focus on opportunities [7][8]. Future Monitoring - The company plans to monitor CAT's volume strength and sustained buying pressure, as well as keeping an eye on potential reentry points for Microsoft (MSFT) and NVIDIA (NVDA) [7][8].

Core Insights - iShares Global Clean Energy ETF (NASDAQ:ICLN) shares experienced a decline of 1.18%, closing at $15.89 on Tuesday, ending an eight-day streak of gains [1] - The index, which tracks the performance of various clean energy-related companies, had previously gained over 6% in the last period [1]

Group 1 - The article highlights the unexpected outperformance of renewable energy during the Trump presidency, particularly referencing the iShares Global Clean Energy ETF [1] - FinHeim Research specializes in investment analysis and portfolio management, focusing on identifying value in both traditional companies and technology sectors [1] - The firm emphasizes thematic investing research and macroeconomic trends, aiming to provide objective analysis for investors [1] Group 2 - No specific company or stock positions are disclosed by the analyst, indicating a neutral stance on the investments mentioned [2] - The article does not provide any recommendations or advice regarding investment suitability for individual investors [3]

Core Insights - The iShares Global Clean Energy ETF (NASDAQ: ICLN) aims to provide investors with exposure to clean energy producers, highlighting the growing interest in renewable energy investments [1] Group 1: Clean Energy Sector - Energy policies are transitioning away from tax credits for renewable energy sources, suggesting a potential shift in the investment landscape for clean energy [1] - The clean energy sector may have one last opportunity for significant growth before these policy changes take full effect [1] Group 2: Analyst Background - The analysis is conducted by Michael Del Monte, a buy-side equity analyst with over 5 years of experience in the investment management industry, and a background in various sectors including oil and gas, industrials, and technology [1]