ETF Update: Earth Day ETFs, Silver in Demand, Transportation ETFs Feel Fuel Pinch

There are numerous ways one can celebrate Earth Day: take out the recycling, turn off the lights, carpool to work or buy green ETFs.

After all, ETFs don't emit anything, so you don't even have to feel guilty about being a polluter.

While the sector has taken a hit along with the rest of the market in recent months, many experts encourage investors to take a long view when it comes to these funds. The United States is still in the early stages of solar energy development, and an interest in alternative fuels could increase if the cost of oil and gas keep up the way they have been.

Some experts accuse many companies of "greenwashing"; that is, making claims that make consumers think they're more environmentally responsible than they actually are. Luckily, consumers are catching on, CNBC reports. In Britain and Australia, there are already hefty fines that come along with false claims.

The Federal Trade Commission is currently reviewing its own environmental marketing standards. Terra Choice lists the six greenwashing sins.

There are a number of green ETFs to choose from, so take your pick. And remember to turn out the lights.

A few of them:

• PowerShares WilderHill Clean Energy (PBW), down 20.7% year-to-date
• PowerShares Global Clean Energy (PBD), down 12.2% year-to-date
• Market Vectors Global Alternative Energy (GEX), down 10.5% year-to-date
• First Trust NASDAQ Clean Edge US Liquid (QCLN), down 21.5% year-to-date
• PowerShares Cleantech Portfolio (PZD), down 5.8% year-to-date
• Claymore Global Solar Energy (TAN), up 4.4% since April 15 inception

Silver, Base Metals ETFs Reflecting Strong Demand

Demand for silver is on the rise and it's reflected in the silver ETF.

Gene Arensberg for Resource Investor says the rise in demand is evident because the paper silver market isn't reflecting popular demand. The COMEX paper silver market is related to, but different from, the physical one in that it deals exclusively with very large, average 1,000-ounce "good delivery bars," and each futures contract covers the delivery of five of those bars.

The physical market is every coin and bullion shop and a range of other silver products.

The scarcity of the metal is evident now, Arensberg says, because dealers are paying higher than normal premiums, evidence of an immediate need for the metal. This means that current inventories are insufficient to meet the demand at the prevailing spot price. Some dealers are paying premiums as much as $1.85 over the spot price - costs that will be passed on to their silver-buying customers.

The iShares Silver Trust (SLV) has benefited from demand for the metal. Year-to-date, the fund is up 17.7%.

PowerShares DB Base Metals (DBB) traded higher Tuesday, lifted by a strike against Chilean copper miner Codelco, which sent futures for the metal upward. Metals were also stronger because of the weaker dollar and May oil hitting $119.90 a barrel, reports Allen Sykora for Dow Jones Newswires. DBB is up 15.6% year-to-date.

Planes, Trains, Automobiles and ETF Feel the Fuel Pinch

Airlines aren't the only ones feeling grounded by soaring fuel costs: the transportation ETF is in a holding pattern.

Record high prices led to three U.S. airlines reporting big quarterly losses today. UAL Corp. (UAUA), United Airlines' parent company, posted its biggest loss since a Chapter 11 restructuring two years ago. AirTran (AAI) reversed its year-ago profit, and JetBlue Airways (JBLU) also reported a loss. Their loss was smaller than expected, though, reports Kyle Peterson for Reuters.

Jet Blue is a small component of the iShares Dow Jones Transportation Average (IYT) at 0.6%. The fund also holds 1.9% of Continental Airlines (CAL), which reported losses last week.

Two other major components of the fund, United Parcel Service (UPS) and FedEx (FDX), have reported a drop in deliveries for the first quarter. UPS said earnings through March will miss projections by as much as 7.4%. FedEx said shipments were down 2% in the first quarter and that it would have limited earnings growth this year, reports Mary Jane Credeur for Bloomberg.

Together, both companies deliver 80% of packages in the United States. IYT holds 9.3% of FedEx and 7.3% of UPS.

The prices of oil and gas hit new records today: gas went above $3.50 a gallon, while oil hit $119.90 a barrel, reports John Wilen for the Associated Press.

Disclosure: Some of Tom Lydon's clients own shares of IYT.