How are you aligning your holdings with your values to help influence the change you wish to see in the world?
Using an ESG strategy does not require you to sacrifice long-term potential portfolio performance. At Alpen Wealth, we are committed to showing you how you can achieve both goals. We’ve outlined 5 approaches below that we believe help you add an ESG strategy to your investment selection.
5 Key approaches you can use to incorporate an ESG strategy into your portfolio:
- Positive/best-in-class ESG screening*:
- Invest in funds, plans, sectors, companies or projects selected for positive ESG performance relative to industry peers.
- Avoid holdings that do not meet our ESG performance thresholds.
- Negative/exclusionary ESG screening:
- Exclude a fund or plan of certain sectors or companies involved in activities deemed unacceptable or controversial to you.
- ESG integration:
- Systematically and explicitly include ESG factors in your portfolio’s financial analysis.
- Impact investing:
- Target investments in holdings aimed at solving social or environmental problems important to you.
- Sustainability-themed investing:
- Select single or multi-facet funds specifically related to sustainability.
As an investor, you have an opportunity to support those social practices about which you are the most passionate in your IRA’s, non-qualified accounts, and 401k or 403b plans. For example, we see investors are opting to support companies making efforts to help save our environment. Others have chosen to remove companies that manufacture tobacco products or weapons. Still others want to influence the way large corporations are governed to promote equality.
The chart below outlines current leading ESG issues and shows the latest statistics released by US|SIF, The Forum for Sustainable and Responsible Investment, in their Report on US Sustainable and Impact Investing Trends 2020.1
Where do you wish to influence change? We feel knowing what your investments are supporting is important to your financial wellbeing. Contact Us for a Portfolio Review to see how well your current portfolio is aligned with your values.
This content is developed from sources believed to be providing accurate information and provided by Twenty Over Ten, Alpen Wealth Advisory Group, LLC and other resources. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information and should not be considered a solicitation for the purchase or sale of any security. Nothing contained in this commentary is intended to constitute legal, tax, accounting, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. All investments carry a certain risk, and there is no assurance that an investment will provide positive performance over any period of time.
* “Positive/Best-in-class” ESG is industry terminology referring to an investment approach that selects companies that are leaders in implementing ESG.
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