Hydrogen exchange-traded funds (ETFs) enable investors to play the potential boom in this low-emissions fuel. Several forecasters see hydrogen growing into a more than $1 trillion market, which could fuel lots of growth for companies focused on the sector.
Picking the right hydrogen stock to play this growth opportunity might not be easy. Potential mismanagement or financial issues could cause a leading hydrogen company to underperform its promise and rivals.
That's why investors might want to consider investing in an exchange-traded fund (ETF) focused on the hydrogen stock market sector to gain broader exposure to the entire trend. Here's a look at the best hydrogen ETFs to consider buying.
Exchange-Traded Fund (ETF)
Best hydrogen ETFs for 2025
There's currently only one pure-play sector ETF focused on hydrogen after other hydrogen funds liquidated and closed. Additionally, some clean energy ETFs hold hydrogen stocks in addition to alternative energy stocks.
Here's a closer look at the top ETFs to buy for investors seeking focused exposure to the hydrogen sector.
1. Global X Hydrogen ETF
NASDAQ: HYDR
Key Data Points
2. First Trust NASDAQ Clean Edge Green Energy Index Fund
NASDAQ: QCLN
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Should I buy hydrogen ETFs?
There are many reasons to consider buying a hydrogen ETF, including:
- Gaining broad exposure to the top stocks in this potentially massive industry.
- Passive investment in a fund instead of actively managing a portfolio of hydrogen stocks.
- Preventing the potential pitfalls of being right on the investment thesis (hydrogen demand will grow exponentially) but selecting the wrong investment vehicle to express that view (e.g., a stock underperforming due to mismanagement or financial issues).
- Aligning your portfolio with your environmental values.
Investors who want to go the ETF route have a couple of options to consider.
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Factors to consider before investing in hydrogen ETFs
Investors need to evaluate a few things before adding a hydrogen ETF to their portfolio, including:
- Size: The sole pure-play hydrogen ETF is very small, which could make it volatile and potentially at risk of closing and liquidating, which has been the case with other hydrogen-focused ETFs.
- Cost: Whether the ETF expense ratio is worth it for passive exposure to the sector.
- Focus: If you want a pure-play hydrogen ETF or a fund focused more broadly on alternative energy.
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