SolarCity: A big Deal for Solar ETFs

ETF Trends

SolarCity (SCTY), the solar company co-founded by Elon Musk of Tesla (TSLA) fame, is a story stock. The shares have more than quadrupled this year.

That has helped boost the fortunes of the solar sector at large, which in turn has led to a revival of epic proportions for the two solar ETFs: The Guggenheim Solar ETF (TAN) and the Market Vectors Solar ETF (KWT) .  [First Solar Lifts Solar ETFs]

While both ETFs rank among the top-10 non-leveraged ETFs this year and both have more than doubled, there is a significant performance gap between the two in favor of TAN. TAN was up 147% at the start of Friday’s trade. KWT was up “just” 102.6%.

A big part of the reason for that gap is SolarCIty. As in SolarCity has dwelled in TAN for most of this year. It is now the ETFS’s second-largest holding at 5.7%. [Big Differences Between Two Solar ETFs]

KWT was finally added SolarCity when the Market Vectors Global Solar Energy Index (MVKWTTR) rebalanced on September 20. It is now the ETF’s ninth-largest holding with a weight of 4.7%, according to issuer data.

Still less than TAN, but better than no SolarCity at all. This is how a big of a deal SolarCity is to solar ETFs. Since KWT started trading with the stock on September 23, the ETF is up nearly 23%. In the month prior to adding SolarCity, KWT was up “just” 19.6%.

Market Vectors Solar ETF

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