You can’t be entirely sure where your cash will go, but funds that have steered clear of controversial sectors such as gas and oil are prospering.
They have been ridiculed by some and overlooked by others, but ethical investment funds – and the people who have put money into them – are having the last laugh.
Over three years, the typical ethical fund is up by around 32%-35% compared with 28% for the FTSE All-Share index and 24% for the AFI Balanced index, which is based on financial adviser fund recommendations. Those looking at green energy and who have an eye constantly on the effects they have on the world as a whole are looking at investing in Ethical Funds to take their personal stance to the next level.
The green investments that can put you in the black
Some ethical funds, such as Premier Ethical (from Premier Asset Management) and Royal London Sustainable Leaders Trust, are up by as much as 65% and 55% respectively.
FP WHEB Sustainability Fund
A £79m fund launched in 2009 which “invests exclusively in companies providing solutions to sustainability challenges”. Ranked 19th out of 74 funds over three years, it is up almost 41% in that period, according to data provider FE Trustnet.
Alliance Trust Investments
Selected for its strong performance and for providing high quality transparent information to investors, Castlefield says. The Alliance Trust UK Ethical fund is up 45% over three years.
ConBrio B.E.S.T Income
A £16.5m fund launched in 2006. The B.E.S.T stands for business and financial, environmental/ecological, social/governance and transparency – the four criteria applied to potential investments. This highly innovative fund offers investors a high level of income (4%) with no exposure to fossil fuel extraction – a unique combination in the UK investment market. Up 35% over three years.
Quilter Cheviot Climate Assets Fund
A £31m fund launched in 2010 that invests predominantly in shares and focuses on sustainability with five key themes: energy, food, health, resources and water. Up 27% over three years.
Impax Environmental Markets investment trust
This focuses on environmental businesses. It aims to allow investors to benefit from growth in the markets for cleaner basic services relating to energy, water and waste, and the more efficient delivery of them. It’s up 59% over three years.
Some funds take a very strict line on issues such as animal testing, pollution and pornography, and won’t invest in companies that have anything to do with such activities. Others will invest in companies in the more controversial sectors such as oil and pharmaceuticals but say that they aim to seek out those doing good things – for example, something positive to improve the environment.
It is certainly clear, though, that the move to divest from fossil fuels is gaining momentum and if you are investing for your future – why not invest for the next generation and the generation after that’s futures as well!
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