Everyone it seems has been investing in green energy – from Google to ExxonMobil. But this year the booming sector is suddenly in a serious funk. So is this time to get out – or jump in and snap up some long-term winners? To find out, the Monitor's Laurent Belsie recently talked with three experts who closely follow the field: Matt Patsky, portfolio manager of the Winslow Green Growth Fund, Paul Hilton, director of advanced equity research at Calvert, and Eric Becker, portfolio manager with Trillium Asset Management. Here are edited excerpts of their conversation:
Matt, you've had the No. 1 fund of all small-cap growth funds over the past five years. This year the sector has tanked. What happened?
Patsky: It obviously has been a very difficult market overall in the beginning of 2008. In addition, our focus, particularly in our Winslow Green Growth Fund, is small-cap growth. And small-cap growth has been particularly under pressure..... You've seen stocks that run [up] the most come down the hardest, even if everything's fine in terms of fundamentals.
So is the green-energy boom over?
Hilton: I don't think so. If you look at the long-term trends that are supporting alternative energy, there's no doubt that this really is a good play.... There will be short-term volatility. But if you look at things like the price of oil, the amount of new investing that's going into promoting new companies in this space, all the potential climate-change legislation that we're seeing, this really does create a perfect long-term [opportunity] for this sector....MORE