Expecting oil prices to stay high, investors have been flocking to exchange-traded funds based on renewable energy sources such as wind power.

ETFs, which trade throughout the day on exchanges, are based on indexes that aim to replicate the performance of groups of stocks. Some are designed to allow people to bet on hot market niches.

But creating an ETF index that faithfully tracks a fledgling industry like wind isn't easy. As a result, the wind ETFs include companies whose revenue from that business is modest -- and sometimes hard to even quantify.

That makes it difficult to know how such ETFs might perform, even if wind generation catches a strong gust.

Designers of the wind-industry indexes say it makes sense to include big, diversified companies along with smaller ones that focus only on wind generation. They say that, over time, the ETFs will be tweaked to more purely reflect wind-industry growth.

For now, the ETFs provide "relatively low-cost access to unique areas of the market that might be difficult to get into a portfolio," says Ed McRedmond, senior vice president for portfolio strategies at the Invesco PowerShares Capital Management LLC unit of Invesco Ltd., sponsor of eight clean-technology ETFs.

Meantime, cash is blowing in.

More Than Forecast

When First Trust ISE Global Wind Energy Index Fund began trading in June, sponsor First Trust Advisors LP hoped it would draw perhaps $100 million in a year. But in little more than a month, the fund's assets have swelled to $72 million, says First Trust, based in Lisle, Ill.

The PowerShares Global Wind Energy ETF has drawn in some $16 million since it began trading July 1.

It hasn't hurt that Texas oilman T. Boone Pickens is urging large-scale investments in wind generation to reduce oil imports and is investing a substantial amount of his own money in the business, fund sponsors agree.

Financial advisers and their clients have been clamoring for targeted ways to bet on wind, which they view as among the more viable alternatives to oil. But with the new ETFs, they're getting much more.

Both the First Trust and PowerShares ETFs own General Electric Co. GE is a big wind-turbine maker, but such sales last year were less than 3% of its more than $180 billion in revenue. And if the wind ETFs had been trading in April, they would have been affected by GE's earnings miss, which spurred a 13% one-day drop in its shares.

Also among the 67 stocks held by the First Trust ETF is Sweden's SKF AB, which makes bearings and seals. It gets 3% to 4% of its 58 billion kronor ($9.58 billion) of revenue directly from wind-turbine components, a spokeswoman says.

Then there's Terna SA, a Greek construction company that builds wind parks. It also receives a major amount of revenue from work on Greece's central highway.

Mashed-Potato Play

Another First Trust ETF component is Otter Tail Corp., a diversified utility company based in Minnesota and North Dakota. It has some wind-generation capacity. But after a diversification push, it also sells in markets ranging from medical diagnostic-imaging systems to food. One unit makes dehydrated potato flakes for instant mashed potatoes.

Computing how much revenue diversified companies get from wind sometimes can be daunting, says Kris Monaco, director of new product development at the International Securities Exchange unit of Europe's Eurex AG, designer of the index for the First Trust wind ETF.

"When you have a firm that supplies materials to wind-energy farms or is involved in development of those farms, you can't really tell from their financial statements how much of that revenue is devoted to wind," he notes. "We review their corporate Web site and financial statements and look at their stated focus as a firm. If possible, we try to break out what the percentage of revenue exposure is. But for smaller firms, there is some art involved."

All the multinational companies that were included in the PowerShares wind ETF's index get at least $1 billion in revenue from the wind industry. That qualifies each as "a player in the space," says Ron Pernick, principal at Clean Edge Inc., a research firm that designed that fund's index.

ETF sponsors caution that investing in such funds can pose risks. Wind ETFs aren't aimed at "do-it-yourselfers," says Dan Waldron, head of First Trust's ETF business. "They are for the adviser who understands his client's risk tolerance and goals and uses them in the context of a much broader, diversified portfolio," he says.