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Market Research - February 23, 2021

Free Download: Breaking Down ESG & SRI Funds

Are you hearing from clients about investment strategies like Socially Responsible Investing (SRI), Environmental, Social and Governance (ESG), and Impact Investing?

In our latest research report, we share valuable information and advanced insights about mutual funds and ETFs that employ ESG, SRI, and Impact strategies. Our findings help ensure that advisors, asset managers, and their clients are “speaking the same language” when discussing ESG and SRI, enabling more informed conversations and smart, mutually beneficial investment decisions.

Download the Free Guide for ESG & SRI insights and visuals:

Included in the guide are free-to-download visuals that can be easily shared with your clients and colleagues. Each finding and visual is data-driven and unbiased, but they are not meant to serve as investment advice.

Here’s a preview of what’s inside:

As investor demand grows, so does the number of ESG & SRI funds

It may not be surprising for advisors and asset managers who hear it first hand from their clients, but the demand for responsible, social, or environmental investing vehicles has spurred a sizable response from fund managers.

Our study included more than 470 mutual funds and ETFs that employ ESG and SRI strategies, and the majority of them debuted in 2015 or later. Additionally, fund managers increasingly use ESG or SRI-related keywords in their funds’ names. Some popular keywords that appear in fund names are “sustainable”, “impact”, “green”, and “aware”, to name a few.


ESG and SRI aren’t all hype—most funds outperformed the S&P 500 in 2020

You may associate environmental and social investing more so with individual preferences, and not necessarily performance; however, one tenet of ESG investing is that companies with a grasp on their environmental, social, and governance practices are well-positioned to outperform in the future.

Based on the mutual funds and ETFs we analyzed, there’s substance to that belief. Since their inception dates, 40% of ESG and SRI funds have outperformed the S&P 500, and 50% beat the market in 2020.


Setting expectations for ESG and SRI investing

From the outset of this study, we had a hunch that the most important element of ESG and SRI is clear, effective communication among asset managers, advisors, and their clients. In hindsight, we’re even more convinced.

With the growing number and diversity of ESG and SRI mutual funds and ETFs, it’s increasingly important to critically evaluate these strategies. In turn, you can identify and invest in the funds that most closely align with agreed-upon investing goals and personal criteria for impact, social, or responsible investing. 

Download the Free Guide for ESG & SRI insights and visuals:

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