by Harris Roen, Editor
Roen Financial Report
December 10, 2013

The Paradigm Portfolio is a select list of alternative energy companies chosen by the Roen Financial Report. This hand-picked collection of about 40 stocks are considered the best investments in  energy efficiency, environmental, fuel alternatives, smart grid, solar and wind. The Paradigm Portfolio is up 39% since inception (January 1, 2013) after accounting for additions, removals, and rebalancing.

Returns

Of the companies currently in the portfolio, 92% are up since inception. In fact, with the exception of only one company, all of the gainers are up in the double digits. Four companies that have returned over 50%: Fuel Tech Inc. (FTEK), SolarCity Corp. (SCTY), The Andersons, Inc. (ANDE) and Google, Inc. (GOOG). Only three companies trading down, and none of these stocks have lost more than 5%.

 

Diversification

Companies are picked for inclusion in the Paradigm Portfolio using multiple criteria. We look at a large array measures including financial screens, debt levels, speculative benchmarks, stock price valuation and analyst opinions. In order to assure as much of a balanced portfolio as possible, an eye is also kept to diversification. Companies are picked that balance the portfolio across factors such as company size, alternative energy sector, location and alternative energy industry.

 

Portfolio Update

One company is being removed from the portfolio, The Andersons, Inc. (ANDE). This Midwestern biofuel company has done very well, up 58% after rebalancing.

ANDE is being removed for several reasons. It has passed fewer stock screens in the latest assessment, and is only recommended as a buy by one analyst. It is considered overvalued, trading at the very upper end of its fair value channel. There are also good political reasons to be cautious in the biofuel industry at this point in time. In addition, because the stock market in general, and alternative energy in particular, have been performing so well, taking some profits now should be a wise decision.

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*Hypothetical gain from portfolio recommendations. It should not be assumed that recommendations made in the future will be profitable or will equal the performance of the securities on this list.

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DISCLOSURE

Individuals involved with the Roen Financial Report and Swiftwood Press LLC owned or controlled shares of GOOG. It is also possible that individuals may own or control shares of one or more of the underlying securities contained in the Mutual Funds or Exchange Traded Funds mentioned in this article. Any advice and/or recommendations made in this article are of a general nature and are not to be considered specific investment advice. Individuals should seek advice from their investment professional before making any important financial decisions. See Terms of Use for more information.

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Remember to always consult with your investment professional before making important financial decisions.