SUSA - 1 Fund to Invest in a Sustainable Future
If you favor companies that are working toward a sustainable world, ESG funds offer the easiest way to invest in them. These funds encompass companies striving for positive environmental and social impact and responsible governance. Better yet, studies show that companies pursuing a healthier planet, diverse and well-treated workers, and responsible executive pay don't sacrifice their financial performance to achieve those goals. ESG funds may allow investors to do well for themselves while doing good for the world.
According to the Morgan Stanley Institute for Sustainable Investing, U.S. sustainable stock funds in 2020 outperformed their traditional peer funds by a median total return of 4.3 percentage points, with 3.1 percentage points less downside risk than their traditional peers. iShares USA ESG Select ETF (NYSEMKT: SUSA) posted an impressive 30.45% return, outperforming the median peer fund in the Morgan Stanley study by over 10%.
Sustainable funds can outperform partly because the companies they invest in are less likely to incur negative publicity or costly regulation over their working practices or harmful emissions. Correctly or not, investors increasingly believe that companies that meet their sustainability goals can generate higher profits over time than companies that don't.
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1 Fund to Invest in a Sustainable Future