Do investors pay a premium for going green? Evidence from alternative energy mutual funds

We studied the financial performance of alternative energy mutual funds using multifactor models and propensity score matching techniques. For a sample of alternative energy mutual funds quoted in EUR and in USD for the period 2010-2016, we found that alternative energy funds underperformed corporate and socially responsible mutual funds in terms of returns and downside risk protection. Our results are consistent with the idea that investors are paying a premium for going green via renewable energies.