Socially responsible investing (SRI) is a growing investment strategy. SRI managed assets have risen by 22%, to $3.74 trillion, just in the last couple of years. Today’s pick follows that trend, and has rewarded investors with a 35% return year-to-date.
Ariel Investor (ARGFX)
from NoLoad FundX
Sustainable and responsible investing, also known as socially responsible investing, is an investment discipline that considers environmental, social and corporate governance criteria (ESG) to generate long-term competitive financial returns and make a positive societal impact.
There is no single approach to SRI. Rather it spans a wide and growing range of products and asset classes. The growth of sustainable investing in recent years strongly suggests that an increasing number of investors believe that returns from SRI strategies are comparable to those of more conventional investments.
SRI may seem like a new trend, but it’s been around for decades. One of the first socially focused indexes, the KLD (named for its founders Peter Kinder, Steve Lydenberg, and Amy Domini), began in 1990.
Funds that use social screens as part of their investment process have been a part of NoLoad FundX for many years, and this month, we’re adding another seven SRI funds to the mix. We’ve also made it easier to find funds that have a social focus. We’ve marked these funds as SRI in the Underlying Portfolio column in our newsletter.
Most Upgraders have likely invested in SRI funds, even if they didn’t realize it. Ariel (ARGFX), for example, is a mid-cap value fund that happens to screen out weapons and tobacco companies. We have ranked Ariel as a Class 3 Fund, with a Buy rating.
Investors who want to include more sustainable investment funds in their portfolios can now look for the funds marked SRI and then use Upgrading to select the best performers. Others can simply follow the ranks as they always have and include SRI funds when they are outperforming other funds.
Janet Brown, NoLoad FundX, www.fundx.com, 800-763-8639, November 2013