INRG

coastline

Don't know much but it appears INRG is classed as " interest rate sensitive " . The good news is rates might be near the peak . Today in US FED held rates.

 United States Fed Funds Interest Rate (tradingeconomics.com)

In the last year bond yields are up and INRG has continued to fall.

US 10 Year Treasury Bond Note Yield - Quote - Chart - Historical Data - News (tradingeconomics.com)

iShares Global Clean Energy UCITS ETF, UK:INRG Advanced Chart - (LON) UK:INRG, iShares Global Clean Energy UCITS ETF Stock Price - BigCharts.com (marketwatch.com)

Review from AUG.

BlackRock’s clean energy ETF hits three-year low (etfstream.com)

Top 10 represent nearly 50% of portfolio and there's a few heavy fallers..

iShares Global Clean Energy UCITS ETF USD (Dist) summary price and performance data – Investors Chronicle

Shocking_Blue

Thanks, coastline. From that info it seems that, aside from a general downturn in the sector, holdings such as Enphase and SolarEdge have really eaten into the price of this. Hopefully as they, and the sector, recover, the price will start to slowly creep back up. Worth holding on I guess. Cheers.

JohnWinder

INRG reads like a case study of thematic funds, especially when one looks at the pre-2021 price chart. ‘Lighting your money on fire with thematic ETF’s’.  https://rationalreminder.ca/podcast/185 

Linton

I would guess that the fund is simply a victim of the increase in risk-free interest rates.  Investments like windfarms work on the basis of very high initial costs followed by  long term repayment through vehicles like bonds on which investors gain interest.  SInce risk free interest rates have risen enormously the money generated from investment in infrastructure looks much less attractive and so prices drop until the yields are comparable.

There was a piece on the BBC news this morning or possibly yesterrday saying that recent sales of windfarm licences by the UK government have attracted no bids since at current electricity prices they would not make sufficient profit to pay for the high interest on the borrowing..

PS the flip side of this effect is that infrastructure funds now look very attractive for income investors

Shocking_Blue

Linton said:

I would guess that the fund is simply a victim of the increase in risk-free interest rates.  Investments like windfarms work on the basis of very high initial costs followed by  long term repayment through vehicles like bonds on which investors gain interest.  SInce risk free interest rates have risen enormously the money generated from investment in infrastructure looks much less attractive and so prices drop until the yields are comparable.

There was a piece on the BBC news this morning or possibly yesterrday saying that recent sales of windfarm licences by the UK government have attracted no bids since at current electricity prices they would not make sufficient profit to pay for the high interest on the borrowing..

PS the flip side of this effect is that infrastructure funds now look very attractive for income investors

Thanks, Linton.

So you think this is best regarded as a long term hold?

Cheers

Linton

Shocking_Blue said:

Linton said:

I would guess that the fund is simply a victim of the increase in risk-free interest rates.  Investments like windfarms work on the basis of very high initial costs followed by  long term repayment through vehicles like bonds on which investors gain interest.  SInce risk free interest rates have risen enormously the money generated from investment in infrastructure looks much less attractive and so prices drop until the yields are comparable.

There was a piece on the BBC news this morning or possibly yesterrday saying that recent sales of windfarm licences by the UK government have attracted no bids since at current electricity prices they would not make sufficient profit to pay for the high interest on the borrowing..

PS the flip side of this effect is that infrastructure funds now look very attractive for income investors

Thanks, Linton.

So you think this is best regarded as a long term hold?

Cheers

I believe all funds should be held for the long term.  If they are not worth holding for the long term they are not worth holding at all.  If your needs are short term dont invest in equity funds.

Personally I would not hold INRG at all......

1)  It is too niche a fund to be worth holding in a diversified growth portfolio.  If you invest at this level of detail you are going to need an over-large number of very small % holdings of such funds to give a well diversified coverage.

2) Utility/infrastructure funds can be useful for income but this one has too low a yield for that to be a good reason to hold it. 

If you want the fund for some other reason than investment returns I am afraid I cannot comment on this fund without knowing your objective - you have to make your own judgement. For me financially sustainable investment returns are the sole objective for investing.  If you want to campaign for something there are cheaper and more effective ways of doing so.

ChesterDog

I've made a very good return on INRG, so I can't really grumble that a lot of its gains have unwound, especially as I repeatedly reduced my holding on the way down, so I'm still well ahead overall.

However, as others have stated, it's a niche product, in a sector with its own unique opportunities and challenges. Those challenges have been large lately - perhaps they will start to resolve before long. Single-sector investments tend to look great until they don't.

I'm going to hold for another year, but it's below 5% of my total investments, and I can regard it as a bit of speculative enjoyment.

Shocking_Blue

ChesterDog said:

I've made a very good return on INRG, so I can't really grumble that a lot of its gains have unwound, especially as I repeatedly reduced my holding on the way down, so I'm still well ahead overall.

However, as others have stated, it's a niche product, in a sector with its own unique opportunities and challenges. Those challenges have been large lately - perhaps they will start to resolve before long. Single-sector investments tend to look great until they don't.

I'm going to hold for another year, but it's below 5% of my total investments, and I can regard it as a bit of speculative enjoyment.

Yep, It's about 6% of my ISA S&S, but I'm still not too chuffed that it's down approaching 50%. Guess it's just a 'bottom-drawer', so to speak.