We have been investing in the Environmental, Social and Corporate Governance (ESG) space for our socially conscious clients for decades. What we have found is that ESG investing tends to tilt towards the “growth” investments like technology, for example. When growth does well, our socially conscious portfolios outperform our non-socially conscious model. The reverse is also true. When growth disappoints, our socially conscious models will trail.
The other factor to consider is socially conscious investing tends to have higher expense ratios whether an investor uses an index or a managed fund. The extra social screen that indexes and managers use to eliminate ESG non-conforming investments takes an extra amount of time and effort. Indexes and managers will want to be compensated for that extra time.
If, after you read the above caveats, you are interested in ESG investing, we would be happy to show you how the securities we use stack up to the benchmarks.
Contact us to see how we can invest with you.