FINDING ALTERNATIVE ENERGY INVESTMENT FUNDSALTERNATIVE ENERGY INVESTING GAME PLAN
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The safest way to invest in alternative energy is through alternative energy investment funds. The big advantage of funds over individual alternative energy companies is that you spread the risk around and multiply your chances of investing in one of the alternative energy companies that does really well. Finding good alternative energy investment funds takes some research. But the eight-step process shown here will simplify the process. While some of the steps in this section are the same as those found in the Conventional Energy Investing Game Plan, there are important differences as you will see. _________________________________________________________________
NOTE: Some of the steps below link to free resources at www.wsj.com. But when you click this link for the free trial of The Wall Street Journal Online
If you're considering the print edition, you can click here for a Special Free Week offer to either the Print or Online editions of The Wall Street Journal!!!
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STEP 1- Understand investing basics discussed on our Investing Basics page. _________________________________________________________________
STEP 2 - Understand both market risks and the level of risk you are willing to accept as you attempt to achieve your desired returns. The Investing Risks and Alternative Energy Investing Risks pages are primers on risk assessment. _________________________________________________________________
STEP 3 – Know how to find good alternative energy investment funds. There are over 16,000 mutual funds competing for your investment dollars. Only a handful are alternative energy investment funds. The fund finding resources on the Find The Good Funds page can help locate these funds. But you also need the resources discussed in Step 4. _________________________________________________________________
STEP 4 – Find profitable alternative energy investment funds that fit your personal investment requirements. Before using any of the on-line fund screeners, you’ll need to have some idea of what alternative energy funds you seek. To accomplish that you need to search some special interest sites. These sites specialize in areas commonly referred to as renewable energy, alternative energy, or green investments. They have good information about the industries involved with these technologies and a variety of links to specialized areas of interest. Here are some good sites to check:
Altenergystocks.com Mutual Fund Archives
As you search through alternative energy funds you’ll see that they are diversified in a way similar to conventional energy funds. They make a lot of investments in alternative energy companies like wind, solar, and biomass. But they also invest in energy support industries like batteries, flywheels, special materials, and much more. The diversity of investments reduces your risk of loss in a new technology arena that is full of risk. Some of these funds are doing remarkably well, but investors are forewarned that this is a high-risk investment arena with many challenges. Even funds that have enjoyed fantastic returns over the last year or so are not immune to drastic losses. And of course, past success is no guarantee of future profits. _________________________________________________________________
STEP 5 – Find out how your selected funds compare to others. When you have located several alternative energy funds of interest, it’s time to turn to resources like the Wall Street Journal Fund Screener and the Wall Street Journal Mutual Fund Research section. Those links will help you determine how your choices compare to similar funds. Using these resources is explained in detail on Step 4 of the Conventional Energy Funds page. These and the other resources shown on our Find The Good Funds page are great tools you can use again and again in your search for alternative energy investment funds. Some of the tools are free, others are part of a subscription service. You can explore all of them with the free trial offers to find the one, or ones, you like best. _________________________________________________________________
STEP 6 – Go to the funds you have selected and make your purchases. _________________________________________________________________
STEP 7 – Monitor your investments and watch the market for the changes that will inevitably come. Good fund managers do a lot of the work for you, but fund managers come and go; and that often affects performance. You may find yourself holding a fund for years. But, as is especially the case with new start up companies like those found in alternative energy funds, you may find that better performers come along regularly, and you may want to switch funds more often than if you were investing in solid, old firms like oil companies. If you want to trade investments, use caution, follow good investment guidelines like those discussed on the Investing Basics links, and do good research before switching out of one fund and into another. If you are considering the use of a market timing plan with your investments be sure to check out the Free 30 Day Trial of MarketWatchs' Hulbert Interactive Newsletter
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STEP 8 – Keep learning. As with any type of investing, learning more about the many alternative energy companies will help you make better and, hopefully, more profitable investment decisions. In addition to the links shown above, our Energy Resources pages provide tons of vital data on both conventional and alternative energy resources. _________________________________________________________________ _________________________________________________________________
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