Unless you've taken up residence under that celebrated rock where other out-of-touch denizens dwell, it is impossible not to be aware of the ongoing media obsession regarding
energy in general and oil in particular. Almost everyone with some stake in the matter has attempted to muscle into the media recently to promote various alternative energy
products, services and ideas.
In a mix of serendipitous timing and prescient planning, NASDAQ is literally putting other people's money where their mouths are - into the discussion of alternative
energy. On Thursday, May 18, NASDAQ scored a major PR hit with the debut of its Clean Edge U.S. Index, which tracks the stock performances of publicly-traded American companies
in five sectors of the alternative energy industry (renewable electricity generation, renewable fuels, energy storage and conversion, energy intelligence and advanced energy-
related materials).
To create this index, NASDAQ partnered with Clean Edge Inc., a Portland, OR-based leader in clean energy market research. For Ron Pernick, co-founder and principal at
Clean Edge, the new index is not a rush to cash in on a hot topic.
"Clean Edge began thinking about the possibility of creating an index for some time," says Pernick. "We had been posting a stock tracker on our Web site (not an index) since
2001, and we thought an index would be a natural evolution. We began working in earnest on the development of an index in late 2005. About two months ago we connected with NASDAQ
to develop and unveil an index product. Combined with Clean Edge's research expertise in the clean energy sector and NASDAQ's index expertise, we felt it was a perfect
alliance."
This is not the first index tracking in this sector - three similar indexes exist on the American Stock Exchange. But for NASDAQ, the growing popular concern on energy
that began following last year's Hurricane Katrina and rose along with this spring's skyrocketing gas price made the sector impossible to ignore.
"We've had a lot of interest in this from a lot of people looking for a good benchmark to track the sector," explains John Jacobs, executive vice president at NASDAQ. "Energy
is obviously on top of people's minds, so why not look at alternative energy index where new investment is needed and on-going?"
However, Jacobs notes that the new index will be responsive to the sector. "We are not following large conglomerates with a single small operation in alternative energy," he
says. "This is a pure play index."
"Our quantitative approach applies a rigorous screen with regards to market cap, daily trading volume, etc. and our weighting methodology is differentiated in that it is based
on modified market capitalization," adds Pernick.
From the PR perspective, the timing of the index's debut was peerless - there was absolutely no need for NASDAQ to do a vigorous PR push on its launch beyond the May 9 press
release. "We announced this through normal communications channels," says Jacobs. "We just go out and have folks talk about it."
The talk, it seems, has resonated. Not only across the American business and energy media, but also overseas - Jacobs was interviewed by French, Spanish and Italian media
while Pernick tracked coverage in the Dutch press.
"The interest level has been considerable," adds Pernick, who also found his schedule punctuated by a flurry of media inquiries. "We believe this index represents the further
maturation and mainstreaming of the clean energy sector."
But in the event that energy issues should fade from the national headlines, Jacobs notes NASDAQ has faith in the index and is actively promoting its future potential. "We
would not have gone into this if we felt it was just trendy," he says. "This is a long-term sustainable index."
Contact: John Jacobs, [email protected]; Ron Pernick, [email protected].