Green Alpha Next Economy Index (GANEX)

The GANEX is a broad, cross-capitalization, multi-industry, multi-sector green equity index. Its purpose is to:

(1) Represent the emerging, green, eco-efficient economy in all its aspects, in effect defining the next, green economy

(2) Demonstrate the growth, breadth and depth of this Next Economy^TM

(3) Serve as a performance benchmark for active green public equity investment strategies

(4) Provide a universe of Next Economy companies to draw from to manage active green strategies

We believe that the three major, global, macroeconomic conditions currently prevailing: 1)  required sustainable restructuring of the US and world economies, 2) energy and national security and 3) civilization-threatening climate change, make an imperative case for investing in the best companies leading the way to the eco-sustainable, minimal-carbon future.  Or as we call it, the Next Economy.  By Next Economy we mean the whole next economy as it must function to avert eventual collapse: cross-industry, cross-sector, cross-cap, cross-border.  This includes energy solutions, water solutions, smart grid technologies, infrastructure, materials, agricultural solutions, forestry solutions, sustainable commerce, communications and zero-carbon transportation. All these things are connected; solving for one issue type doesn't make sense when confronted with multi-dimensional problems.  Click here for more info on our investment thesis and research process.

Index Management

Next Economy, eco-efficient companies identified during the ongoing research process are evaluated for market liquidity and bankruptcy risk.  Those passing these criteria are admitted into the GANEX with a modified market-cap weighting.  The GANEX is completely reconstituted annually.  In addition, the investment committee meets monthly to discuss possible additions or removals to or from the index between reconstitution events.  These changes, while important to ensure the index remains current with the Next Economy, do not have a dramatic effect on portfolio turnover.