Energy ETF performance: the role of fossil fuels

Clean energy (CE) Exchange Traded Funds (ETFs) experienced a massive growth in the last years. In this paper, we provide investors with an empirical analysis of a sample of energy ETFs which shows how the exclusion of the CE polluting peers, namely the fossil fuels ETFs, does not lead to a deterioration in the financial performance of a portfolio of funds. Furthermore, investigating the connectedness of the CE ETFs with a sample of indexes representing the mainstream markets, we find evidence of significative association only with the stocks and renewables energies markets.