Smart Grid Stock Index Superior to Utility Index PUI

Posted on January 5th, 2010 by admin in Smart Grid

We introduced the RocketCap Smart Grid Stock Index© (RSGSI) in our post of 11 May 09. After substantial volatility in returns through July 2009, we noted that our RSGSI very tightly tracked the S&P 500, and remained superior to the PUI. This relationship remains as of 31 DEC 09. We interpret this convergence to mean that Smart Grid commitments by utilities and their vendors substantially improve market returns over a general portfolio of utility stocks as tracked by the PUI. The investment world has often noted that utilities under-perform compared to S&P 500 since their growth potential is highly constrained by regulations. Thus, the shift to Smart Grid seems to be highly correlated with returns increasing to match S&P 500. Smart Grid investments may have aided the leap up to S&P 500 performance from the shallows of utility performance.

Further Reading and Explanations

Introduction, definitions and meaning of the RocketCap Smart Grid Stock Index©

What annualization means

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