The Green Sheet
Green Your Green™ Spring 2009
Recognizing the impact and positive potential of your investment dollars. |
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Green Investing Update Have green and socially conscious investments been able to shine in the midst of a global market meltdown?
In many instances, yes! Bond funds, in particular, having avoided the subprime mortgage sector, as well as debt from heavily leveraged companies, have plenty to boast about. Funds such as Domini Social Bond, CRA Qualified Investment, Pax World High Yield and Amana Income, all rank in the top decile of their categories for the trailing 1 and 3 year periods.
For stock funds, the results are mixed, which simply highlights the vast range of investment styles and strategies employed by fund managers.
Standouts include Parnassus Equity Income, Amana Growth, and Gabelli SRI, among others, which have trounced their non-green peers over the past year plus.
In general, funds with bolder strategies, such as Winslow Green Growth, have not excelled. In recessions, small-cap growth stocks are often the hardest hit as they rely heavily on capital investments and private equity, both of which have dried up, causing investors to flee such stocks. In addition, international exposure has been doubly difficult due to larger losses overseas and a strong US dollar.
Overall, these results tell us that environmental and socially influenced investment strategies are not a homogeneous group. Despite the markets, several new funds were launched in 2008, further adding to the exciting range of choices and opportunities available to investors. |
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Positives Overtake Negatives with Sustainable Investing In his recent book, Investing in a Sustainable World: Why Green is the New Color of Money on Wall Street, author Matthew Kiernan argues that investing is in the early stages of a profound transformation. He believes investors and companies that incorporate sustainability as a core component of their analytic and business approaches will enjoy competitive positioning and financial success.
For investors who are already analyzing companies based on environmental, social, and governance considerations -- in addition to traditional financial analysis -- does Kiernan have anything new to say?
Kiernan believes global megatrends, such as resource scarcity, demand for transparency, and expanded fiduciary responsibilities will provide competitive advantages for investors and companies.
In addition, one of Kiernan's most compelling insights is that a switch from socially responsible investing (SRI) which began with, and still often remains focused on, negative screens -- such as eliminating weapons manufacturers -- to sustainable investing (SI?) with its focus on positive factors may finally attract broader acceptance and institutional investors, including pensions, foundations, advisors, and consultants. |
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We welcome your calls and emails! Jennifer Hartman, CFP, CFS
Los Angeles
323-330-0579
jhartman@greenleaf-fg.com
Kathleen Hartman, CFP, CFA
Indianapolis
317-576-1727
khartman@greenleaf-fg.com |
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