WATS targets companies building the infrastructure for grid-scale energy storage — the massive battery systems that make renewable energy viable by storing solar and wind power for when it's actually needed. This isn't about EV batteries; it's about the industrial-scale storage that utilities need to replace fossil fuel peaker plants.
How It Works
The fund appears to focus on pure-play battery storage companies, component manufacturers, and project developers rather than diversified energy conglomerates. Given the nascent state of this industry, expect heavy concentration in a handful of leaders like Fluence, Wartsila, and Tesla's energy division, with smaller positions in battery chemistry innovators and inverter manufacturers. The portfolio likely rebalances quarterly to capture this rapidly evolving sector.
Key Features
- Pure exposure to grid storage vs diluted clean energy funds that mix in solar panels and wind turbines
- Captures the battery boom's industrial side — think shipping containers of batteries, not consumer devices
- Early access to a sector where revenues are just starting to inflect as utilities scramble to add storage
Risks
- Technology risk is massive — if solid-state or flow batteries leapfrog lithium-ion, current leaders could collapse 70%+
- Policy whiplash could kill demand overnight — storage economics depend heavily on renewable mandates and grid incentives
- Extreme concentration risk with probably 5-10 meaningful holdings in a sector where one factory fire can crater a stock
Who Should Own This
Best for aggressive growth investors who understand they're betting on a specific technology adoption curve, not diversified exposure to 'clean energy.' Works as a 1-3% satellite position for those convinced battery storage is the bottleneck for renewable adoption. Anyone buying this should be comfortable with biotech-like volatility and prepared to monitor battery chemistry developments closely.