Investors want good returns. Swell investors want good returns and investments that make an impact. The Swell team aims to deliver profit as well as purpose by investing in companies that are both poised for high growth and addressing global issues.
From an investment point of view, this means that value and risk can be more concentrated than the general stock market. In the long run, thematic investing can produce investment returns greater than the broad market return; however, it is also possible that losses may be higher. Thematic investing should be seen as a way to add diversity to an overal financial mix that includes savings, retirement products and other equity and fixed income investments.
It is also worth noting that the oldest US stock index using environmental and social considerations has clearly shown that ESG can actually create added value. In fact, since its birth in 1990, the Domini Social Index (DSI)—now known as the MSCI KLD Social 400 Index—has outperformed both the S&P 500 and the Russell 3000 on an actual and risk-adjusted basis for 25 years.
Extensive academic research and empirical data have shown that socially responsible investing can have a positive, not negative, impact on portfolio returns. Take a look at the resources below!
Gunnar Friede, Timo Busch & Alexander Bassen (2015) “ESG and financial performance: aggregated evidence from more than 2000 empirical studies.” Journal of Sustainable Finance & Investment, 5:4, 210-233