PowerShares Clean Tech (PZD)

A reader asked for my two cents on this fund. I am not a huge fan of this sub-sector. I have one client who has asked for small exposure and for this I use individual stocks that total about 1.5% of the portfolio.

As a matter of perception I think think these stocks add volatility but I find it difficult to get too heavy because of the feast an famine nature of the underlying business. If oil went to $50 and stayed there forever oil companies would make money and investors would lose interest in concepts like clean tech.

That being said I was surprised to see that PZD has been less volatile than the broader sector as measured by iShares Energy (IYE).


I included the iShares Industrial (IYJ) because almost half the fund is in this sector. You can decide for yourself which one PZD is a better proxy for.

One last point that makes this difficult for me to embrace is that it seems like there will always be more talk than action in arena. I buy into the need big time but don't buy into the progress some say is coming.