Ethical Investing in 2018
Five years ago, ethical investments were all the rage in the UK. After all, not only did these options enable individuals to contribute towards the well-being of the environment, but the top-performing funds also rewarded investors with returns of between 40% and 50% in some instances.
While these margins may have been squeezed during recent times, however, the underlying lure of an ethical investment is the good that you can do for the world around us. In this respect, this still offers huge potential to investors, so long as they’re able to identify the best funds and assets. Of course, wealth management firms such as Tilney can help with this, but it’s still good to have an understanding of the market before you enter it.
In this post, we’ll look at some of the available ethical investments in the current market (although this isn’t a recommendation to invest in any of them).
This type of managed fund could be a good option for ethical investors, as they capture stocks that play into clearly targeted narratives. Take the FP Wheb Sustainability Fund, for example, which features a host of stocks that play into a total of nine identified social (and environmental) themes.
When appraising these funds, it’s important to ensure that managers continually review their available stocks and core themes.
You should also improve your knowledge of the companies that deliver positive solutions to the pressing environmental issues of the day, before looking out for these when choosing from a range of sustainable funds.
The Threadneedle UK Social Bond Fund
The Threadneedle UK Social Bond fund is one of the most progressive ethical investment options at present. This targeted fund aims to create a positive social impact by investing in carefully selected and listed bonds, which are issued by organisations that are actively involved in social and economic development initiatives.
According to statistics, more than 80% of the funds’ assets have been allocated to investments with a medium to high social impact, while each option is also economically balanced and capable of delivering returns.
So, if you’re determined to make money and ensure that your investments affect positive change, you could consider this fund.
There are a number of ethical bonds available in the current marketplace, with an increasing number of these coming from private sector firms. Take the recent bond launched by investment company Lendahand Ethex, for example, which will bankroll the supply of solar energy in homes throughout Africa.
Not only does this type of bond affect targeted and positive social change on a global scale, but it also offers typical returns of around 6% per annum. Investors can even choose the location and the nature of their project, so there’s an opportunity to influence how their capital is utilised.
This type of bond is extremely commonplace in the current market, while it’s also ideal for anyone who likes to have a clear understanding of where their money is being invested.