I was thinking of switching to this for my current ROTH IRA that has been going sideways for 5 years. Am I carazy, or are there better alternative energy type funds out there?
For your Roth IRA you want the most aggressive portion of your portfolio. That is because you aren't going to have to pay taxes on the gain when you start withdrawing. I would stay away from any funds that have bonds or other conservative investments. I would definitely consider this fund especially since it's recently pulled back about 10%. Long term I think alternative energy funds stand to do quite well although they are a bumpy ride.
There are now a variety of ways to invest in alternative energy. In my 401K I hold a position in the new DWS Climate Change fund.
I own this fund (Guinness Atkinson AE) outright in a non-tax sheltered account. It is the first alternative energy mutual fund I have bought, and I have been investing in a combination of mutual funds and stocks for 25 years. It has been a very profitable period.
I also hold a number of stocks outright (e.g. STP, WFR, YGE, SGR) that are reasonably classifiable as 'alternative energy' oriented.
Some companies will fail or do less well than others. There is obviously high risk in this sector. But there is no dobut in my mind that this will be an extrordinarily profitable sector in which to be invested in the coming few years if you are risk tolerant.
As such, if you are under 50 or so, I strongly advise holding a significant portion of your portfolio in alternative energy. There will be considerable profits to be made in many alternative energy stocks if you are patient. Buy the dips and you will do well.
If interested in alt energy, may want to check out 2 ETF's: GEX and PBW. I am currently in both. See link for relative performance. http://finance.yahoo.com/q/bc?t=3m&s=GAAEX&l=on&z=m&q=l&c=nalfx%2Cgex%2Cpbw
I've done extensive research into alternative energy funds and ETFs, and this is the one I'm going to put 1 percent of my assets (that's enough for a volatile long-term sector fund like this) in it. To avoid what I think will be high tax implications as the fund increases its turnover, I'm going to buy this within my Roth IRA or 403(b) plan. Remember, you can have multiple investments within an IRA.
I like this better than the ETFs like PBW because these guys actually seem to have an investing philosophy, which has a value orientation. For a sector fund like this, I'd prefer active management. (Don't forget, too, that Wilderhill adjusts its "index" quarterly, and I'm not sure that there's a lot of coherence in how they adjust it.)
As for its high management costs, I talked with one of the portfolio managers via e-mail, and he clearly said that as the assets grow, the fees will go down. That's a hell of a lot better than the upfront sales load AND management fees that New Alternatives charges.
In short, I think this is probably the best play in alternative energy. Combined with a shareholder-friendly international or global fund like the soon-to-reopen TBGVX or DODFX or TAVIX, Guinness Atkinson will allow me to sleep at night both in terms of ethics and nestegg.
We are in the beginning of an energy transformation - driven by declining fossil energy reserves and environmental issues. The world will be dealing with those two crises for the next fifty years. So I do think that alternative energy funds are a great investment. Yes, for your retirement!
I have over half of my investments in renewable energy - and have been richly rewarded. Rewarded to the point that I walk how I invest - and now have solar electric and solar hot water panels on my home.
I choose GAAEX because their energy fund GAGEX did me well (and was the only energy fund to mention peak oil). Plus I like having some investments in European RE firms. I am also invested in PBW, SPWR, STP, YGE, LDK, and WFR. GAAEX has done worse than all of the above. Maybe the GA guys should come out with a Chinese RE fund?
I think alternative energy is the wave of the future but for a roth ira I do not think it is diversified enough . I think you will be in for large ups and downs. Personally I would not use this for my roth IRA.
If your time-frame is 15-30 years out, feel good about putting significant percentages in the Alternative Energy Basket. The field is gaining tremendous world-wide momentum, and the timing is perfect:
1. Less reliance on Middle-East.
2. Oil prices are astronomical and will remain high for a long time.
3. Peak Oil.
4. Global Warming.
5. Bush out of White House.
6. An upcoming generation whose "movement" is the Environment.
Hey there, I've invested in this fund because I felt a strong urge to be involved in alternative energy somehow -- for reasons of values more than the results of any investment analysis.
However, I DON'T think you or anyone should make this fund their single retirement investment. You shouldn't put all your eggs in one basket, especially this kind of basket. This fund is doing great right now, but it's invests in very small sector with lots of uncertainties, so it's going to be really unstable.
If you invest in this, just use part of your money. There's no reason you can't have more than 1 roth IRA. If you get really into it there are all sorts of strategies for how to divvy things up, depending on how long you have to retire.
I own GAAEX but the expense ratio is high at 1.98% (although Ameritrade lists the ER at an astronomical 2.60%, not sure which one is right). I will be moving the fund to ARMDX which is natural resources fund. Forget NALFX, ALTEX and CGAEX they will cost you a 4.75% front load. You are better off buying an ETF like PBW. For more research...go here:
I agree with this. Diversification is something I have tried to do with my investments and I think it is a better long term strategy. I don't like to play roulette with my nest egg.
Regarding this fund, since I enjoy investing and I believe very strongly in alternative energy (especially bioenergy), I found this fund to meet my value based requirements. I want to invest in something I believe not only can make money in the long run, but can help reduce the negative impact on the planet which fossil fuels have.
I don't know how this fund will ultimately do, but I think the goals I have read in my research are good ones as they currently are laid out. Renewable, clean, energy alternatives will be the future. No doubt in my mind about that.