The WilderHill New Energy Global Innovation Index is comprised of companies worldwide whose innovative technologies and services focus on generation and use of cleaner energy, conservation, efficiency, and advancing renewable energy generally. Included are companies whose lower-carbon approaches are relevant to climate change, as smart ‘solutions’ to avoid greenhouse gases, and whose new technologies reduce emissions relative to traditional fossil fuel use.

We subscribe to academic modern portfolio theory, and believe that for NEX the advantages of an indexing approach are persuasive. We pursue 'intelligent-indexing' and analysis-based selection of stocks and sector weightings, which are reviewed according to both qualitative & quantitative methodology. We normally don't change Index composition more often than at Quarterly Index rebalancing. We don't try to 'beat the market' -- nor try to pick 'under-valued' stocks.

We don’t take defensive positions in the Index when markets decline, appear over-valued, or when NEX is experiencing unusually-strong volatility. Rather than select components worldwide on financial or market data alone, we robustly review clean energy broadly conceived, and consider stocks & sectors on technological, environmental, and relevance-to-the-sector criteria. We judge our performance by how well the Index tracks movements of global clean energy -- down and upwards -- and thus we anticipate very significant ongoing volatility in this sector.

In the past decade and especially since the Kyoto Protocol, clean energy has seen significant growth outside the United States, with considerable activity now occurring in Europe, the Asia-Pacific region, and elsewhere. Thus to adequately reflect the worldwide nature of the emerging lower-carbon sector, in general at least half the companies comprising the WilderHill New Energy Global Innovation Index are listed on exchanges outside the United States.

This Index is mainly comprised of companies in wind, solar, biomass & biofuels, small-scale hydro, geothermal, marine and other relevant renewable energy businesses; it also importantly includes companies targeting step-change improvements in generation, distribution and storage of energy, as well as conservation, efficiency, materials, and in the emerging hydrogen and fuel cell sectors, and in associated services. It is a dynamic Index that reflects change.

The global Index is expected to be a diversification tool. Given the volatility of the new energy sector worldwide and since most NEX companies are on exchanges outside the U.S., the Index is expected to be volatile as well.