PBW - PBW: Participating In The Clean Energy Revolution Has A Price

• PBW provides exposure to companies that are publicly traded in the United States and engaged in the advancement of cleaner energy and conservation.
• The fund is well-diversified both across issuers and sectors.
• While it's understandable why investors are drawn to the clean energy theme given the positive growth prospects of the sector, I believe we shouldn't overlook valuations in a rising-rate environment.
• PBW trades at over 20x earnings despite financial conditions tightening, leaving no margin of safety for potential buyers at these levels.
• I ultimately expect this fund to trade lower in the coming months when valuations will return to more reasonable levels across the board.

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