In the mutual fund world, a debate has been raging for years over whether actively managing money is even necessary. Critics of traditional mutual funds point out that in a typical year, 80 percent of actively managed funds underperform their target indexes after expenses. Far better, say the critics, to simply buy a bunch of stocks that represent a given index or sector and leave them alone. Such a portfolio will do as well as the index, and because it will cost next to nothing to run, after expenses it will beat most actively managed funds. Early on, the vehicle of choice for this kind of passive investing was the index fund, a concept that made Vanguard one of the leading mutual fund managers. Then came the exchange traded fund (ETF), which combines the index fund concept with the trading characteristics of a stock. Whereas a mutual fund is priced at the end of the trading day when its component securities are totaled up and can only be traded at the end-of-day price, an ETF holding the same securities can be bought and sold like an individual stock whenever the markets are open. It can also be shorted like a stock, and many ETFs have options that allow for spreads, straddles, and hedges that are impossible with mutual funds. The five clean tech ETFs profiled in the table below should easily outperform broad indexes like the S&P 500 or Russell 2000 in the coming decade. So for most people, buying several such funds is all that's necessary to beat the market.

Table: Green Exchange Traded Funds

The downside of the kind of broad diversification offered by mutual funds and ETFs is that their returns will tend to cluster toward the middle of the pack. That is, they'll do about as well as clean tech in general (which, again, should be very well), but less well than the sector's biggest winners. So if you have the time and inclination to construct and manage your own portfolio, there's a chance to outperform even the clean tech averages. And-no small thing-picking your own stocks is a lot more fun than letting someone else do it for you. Read more to learn about a variety of strategies for breaking clean tech into bite-sized pieces and constructing potentially high-reward portfolios.