Frequently Asked Questions about Sustainable Investing
Why would I invest in a sustainable fund?
The simple answer is that sustainable investing is an opportunity to make money: many studies have demonstrated a connection between environmental, social and governance, known as ESG, and corporate financial performance.
What makes a fund sustainable?
Sustainable investing also has the potential to help mitigate risk. A company with a poor environmental record, for instance, may be more likely to face fines and lawsuits that could really hurt its bottom line. A 2015 CFA Institute survey found that 63% of advisors who consider ESG issues do so “to help manage investment risks.” Morningstar reported that funds with better sustainability ratings tend to have low volatility (“Higher Sustainability Ratings Can Mean Lower Risk”, October 13 2016).
Sustainable investing can also help you to support the issues that matter to you and make a positive impact on the world.
It’s one of the fastest growing investment areas, and according to the U.S. Forum on Sustainable Investing (USSIF), it accounts for one in every five investment dollars under professional management in the U.S.
Isn’t sustainable investing just a way of making a political statement?
No. Many people see sustainable investing as a way to support the issues that matter to them, and these issues tend to cross the political spectrum. For instance, most of us can agree that it’s good for everyone to develop new treatments or cures for disease; reduce toxins in children’s products; have clean water and sanitation; and make sure companies keep our personal information secure.
Won’t sustainable investing suffer from Trump’s policies?
Government policies are just one way to bring about change. These days, big changes are coming from corporations, largely driven by consumer demand and markets. Many companies have found that environmental, social and governance issues are good for business. Major corporations like Apple, Walmart, Proctor & Gamble, Nestle and General Electric1, stated that they will keep their commitments to address climate change, despite changing environmental regulations. (The Upgrader Funds are funds of funds and have no direct investments in individual stocks. Fund holdings are subject to change at any time and are not recommendations to buy or sell any of the underlying funds.)
Can a fund actually make a difference in the world?
Yes. Fund companies have had many successes. In the 1980s, sustainable fund companies were part of the movement to divest from South Africa during apartheid. In the 1990s, they worked with global retailers like Nike and The Gap to improve working conditions in their overseas factories.
In the last decade, fund companies have worked to reduce toxins in children’s products; create safer medical devices; increase diversity on corporate boards; and keep consumer data secure.
Why choose the FundX Sustainable Impact Fund (SRIFX)?
Some sustainable funds can be more focused on their mission than performance. SRIFX seeks to own funds that have strong recent returns PLUS good environmental, social and governance (ESG) ratings. That’s how the fund aims to help you build wealth and build a better world.
SRIFX is a fund-of-funds, so you’ll own a diverse portfolio of funds that is built, monitored and managed by FundX’s experienced money managers. We manage the fund using the same Upgrading strategy that we’ve used for nearly 50 years. Upgrading is designed to help investors build wealth, navigate changing markets and reach lifelong investment goals.
Where can I buy SRIFX?
SRIFX is available directly from our shareholder services. Just call 1-866-455-3863 to get started, or click here to download an application.
You’ll also find SRIFX at most major brokers, including Schwab and Fidelity. You can invest in SRIFX for as little as $1,000.