Clean Energy Transition

Aggressive Thematic

The energy transition is a multi-trillion-dollar infrastructure buildout. Solar, wind, batteries, and the grid — regardless of politics, the economics now favor renewables in most markets.

5
ETFs
1.2%
Aggregate Yield
$14.1B
Wtd Avg AUM

Holdings

Symbol Name Weight Price 1D 3M YTD Yield AUM
ICLN iShares Global Clean Energy ETF 30% $18.90 ... ... ... 1.4% $2.2B
TAN Invesco Solar ETF 20% $55.25 ... ... ... — $1.5B
LIT Global X Lithium & Battery Tech ETF 20% $77.91 ... ... ... 0.4% $1.8B
IDU iShares U.S. Utilities ETF 15% $118.54 ... ... ... 2.1% $1.7B
ITOT iShares Core S&P Total U.S. Stock Market ETF 15% $148.68 ... ... ... 1.1% $83.4B

Investment Thesis

Solar costs have fallen 90% in the last decade. Battery costs are down 80%. In most of the world, new renewable energy is now cheaper than new fossil fuel generation. The International Energy Agency projects $4 trillion in annual clean energy investment by 2030. This isn't a political bet — it's an economics bet. ICLN captures global clean energy producers across solar, wind, and hydrogen. TAN focuses specifically on solar, which has the clearest growth trajectory. LIT captures the lithium and battery supply chain critical for energy storage and electric vehicles. IDU provides exposure to utilities that are investing heavily in grid modernization and renewable capacity. The ITOT allocation adds diversification. The risk? Clean energy stocks have been terrible investments over the past 3 years despite the underlying trend being intact, largely due to rising rates and overcapacity in solar manufacturing.

Portfolio Construction

ICLN iShares Global Clean Energy ETF
30%
Global clean energy producers — solar, wind, hydrogen, and other renewable energy companies worldwide. Provides broad exposure to the energy transition without concentrating in any single technology.
Yield: 1.4% AUM: $2.2B
TAN Invesco Solar ETF
20%
Solar-focused exposure — solar has the clearest economics and growth trajectory of any renewable technology. Includes manufacturers, installers, and integrated solar companies.
AUM: $1.5B
LIT Global X Lithium & Battery Tech ETF
20%
Lithium & battery technology — the energy transition runs on batteries. This captures lithium miners, battery manufacturers, and EV supply chain companies.
Yield: 0.4% AUM: $1.8B
IDU iShares U.S. Utilities ETF
15%
Utilities investing in renewables — regulated utilities are among the largest buyers of renewable energy and are investing billions in grid modernization. They provide income stability while participating in the transition.
Yield: 2.1% AUM: $1.7B
ITOT iShares Core S&P Total U.S. Stock Market ETF
15%
Broad market diversification — total US stock market exposure reduces the concentration risk inherent in a thematic portfolio.
Yield: 1.1% AUM: $83.4B

Key Considerations

  • Clean energy stocks have significantly underperformed since 2021 despite strong underlying trends
  • Rising interest rates hurt capital-intensive renewable projects disproportionately
  • Political risk — subsidies and regulations can change with administrations
  • Chinese overcapacity in solar manufacturing is compressing margins globally
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