As we age, we tend to be come more concerned. And not just about our own retirement, although we should be as concerned as anyone about it. But we become more caring. We have children who may needs us more now than when they were younger. And they in turn may have children, your grandchildren. More than how much can we leave them in terms of inheritance, Boomers are increasingly concerned about the state of the world they are living in and whether they can change it for the good.
But can the investment choices we make have an influence. And of so, can we make any money switching to a more sustainable approach? As the investment year that was 2009 came to a close, one interesting group of funds came to the top of the heap: socially responsible funds or SRI.
They have long been derided by mainstream investors. And in many cases, with good reason. Socially Responsible mutual funds were small (higher risk), cost more (generally at the top of the list for fees-charged) and unable to beat the usual benchmarks most funds are held against. That is until this year.
As it turns out, investing in socially responsible funds would have done the investor a world of good while doing the world some good. We all know now that actively managed mutual funds outperformed the S&P 500 index in 2009. While critics suggest that this is cyclical - and they may be right on some counts - the fact that 65% of these SRI funds who focus on businesses doing the "right thing" not only for their shareholders but the world in which these shareholders live, took much of the investment world by surprise. Read more to find out whether it is socially responsible to outperform.
Paul Petillo is the Managing Editor of Target2025.com
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