What is Socially Responsible Investing (SRI)?

When it comes to investing, traditional considerations include risk and return, taxes, inflation, dividends, and diversification.

But, these days, investors want more. Many want to feel like they are promoting a cause that they care about.

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What Does COVID Mean for Energy Investors?

COVID-19 has led to an unprecedented drop in demand for natural gas, according to a the Gas 2020 report released by the International Energy Agency (IEA) released in June. In some ways, the slump presents an opportunity to pursue a new energy paradigm. Work-from-home has flattened the need for non-renewable back-up energy sources, for example. 

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What is ESG Investing?

While the bottom line matters a lot in the corporate world, especially in the current corporate climate, it is not all that matters to investors. And companies are taking note of this trend. 

More and more, investors are putting their money in companies for reasons beyond simply financial performance. Increasingly, investors want to promote sustainability and social equity with their financial power, and they're doing it through so-called ESG investing (aka taking environmental, social, and governance factors into account). 

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JP Morgan Says COVID to Boost ESG

(August 2020)

One of the few bright spots in the general bleakness of the COVID pandemic is likely to be ESG. At first dismissed for years, and even now occasionally looked down upon despite having $1 tn in assets, the ESG sector is getting fresh attention because of the pandemic. According to JP Morgan, COVID is serving as a catalyst for ESG because the pandemic is acting as a "wake-up call" about ecological risks. The banks says policymakers and investors are drawing parallels "between the unforeseen risks of a pandemic and issues such as climate change". The bank continued "Over the long run, COVID-19 could prove to be a major turning point for ESG investing, or strategies that consider a company‚'s environmental, social and governance performance". Some consider the focus on ESG odd because it runs counterintuitive to the prevailing understanding of investor behavior in times of crisis: a general focus on short-term and economic issues. Nonetheless, ESG has been performing very well on both a return basis and inflows basis.

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High Yield ESG Investors Seeing Outperformance

(August 2020)

High yield ESG bonds - almost sounds like an oxymoron. Companies in the high yield space are generally not known for their green policies, so the association may seem counterintuitive. However, as it turns out, using ESG screens on high yield portfolios leads to good returns, especially during the pandemic. During the worst of the pandemic meltdown in March and April, using ESG as a screen on high yield led to outperformance of benchmarks. The main reason why was that ESG screens naturally eliminated some of the biggest losers, such as energy companies and those with the very lowest credit ratings.

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Actively Managed ESG Funds Outperform Passive

(August 2020)

Those watching the ESG market over the last several months will have noticed an interesting trend has been outperforming benchmarks. Within that performance, though, is a little-known fact that investors may want to take into account: actively managed ESG funds are outperforming passive ones, according to the Financial Times. This success has come out not only in returns, but also in fund inflows, as actively managed ESG funds held 4 of the top 10 spots for overall ESG inflows. There are currently 315 available sustainable open-end funds and ETFs.

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