PWRD goes beyond simple clean energy, tracking companies that are driving fundamental change in the global energy system. It is run as an active fund in which professional managers hand-pick promising stocks and flexibly adjust position weights as market conditions change.

It suits investors who buy into the big-picture themes of climate change response and energy infrastructure investment, and who aim to beat the market through a concentrated portfolio of a small number of stocks.

It is an actively managed ETF launched in 2022 by TCW.

The fund analyzes companies aligned with the core energy transition themes of resolving power shortages, improving grid efficiency, and diversifying energy sources. It focuses on companies shifting from carbon-intensive industries toward decarbonization, as well as technology providers that make this shift possible, and it selects high-growth quality stocks through fundamental analysis.

• Active management across the entire energy transition value chain
• High concentration in a small number of core holdings

Assets under management (AUM) stand at $1.4B, and the expense ratio is 0.75% per year.

Unlike typical clean energy index products, the fund follows an active strategy driven by the manager's judgment, so the weighting of particular sectors or stocks can be very high.

As the need to expand power infrastructure to meet rising demand from artificial intelligence (AI) data centers has come into focus, related holdings have shown positive momentum. Shifts in the macroeconomic energy policy stance are a key driver of returns.

Capital is flowing in as sustainable investing trends converge with demand for infrastructure rebuilding. Investors increasingly prefer infrastructure companies that show real earnings growth rather than a mere thematic story.

A clear growth driver in the energy transition and professional stock selection are its strengths, but investors should consider the high volatility that comes with a concentrated portfolio and the risks of active management.

DYNF, THRO, and others shown in the table are alternatives that use active rotation strategies, while ARKK focuses on disruptive innovation broadly. PWRD stands out for digging deeper into the specific theme of energy system transition than these funds do. Other options include ICLN and QCLN, which invest across clean energy, and TAN and FAN, which specialize in particular energy sources such as solar and wind, and these can also be considered as complementary alternatives.

PWRD is a suitable product for those who want to invest early in companies poised to lead the future energy market. Please review the following points before investing.

The energy transition is a long-term undertaking, so rather than reacting to short-term price swings, it is important to take a patient view of technological innovation and the process of policy implementation.

It is an active alternative worth considering for investors seeking alpha from the structural change of a major overhaul of the energy system. It works well as a strategic asset for allocating a portion of a portfolio to a theme with solid future growth.