Ethical funds: do they now deserve a place in your portfolio?

11 min Read Published: 01 Oct 2020

It's been quite some time since I've written about ethical investment funds. In fact, it's almost four years since I wrote the research article Are ethical funds any good? The best ethical funds to invest in.

As well as identifying strong performing ethical funds, at the time, the research drew a number of conclusions, including:

  • Ethical funds can give decent returns but it is often a result of underlying biases that the ethical fund manager's choices create.
  • A bias towards smaller companies or a skew towards financial and technology firms boosted performance. This limits the upside potential in an environment which doesn't favour these biases. Equally during periods which do favour the overweight positions ethical funds outperform, as they did in the UK All Companies sector between 2012 and 2015.
  • The number of ethical funds was limited back then.

Full article available exclusively to 80-20 Investor members.

To read the complete article, sign up for a free trial or log in below.