Ethically-minded investors have more options as exchange traded funds (ETFs) cross over into the wealth-building, world improving categories. During the past few years, around a dozen ETFs with a socially responsible focus have debuted in the market, reports G.Jeffery MacDonald of The Christian Science Monitor. For instance, two launched in June: PowerShares Global Clean Energy Portfolio (PBD) and the Claymore/KLD Sudan Free Large Cap Core (KSF).
MacDonald notes short term traders don’t usually invest in socially responsible ETFs and hedge fund traders aren’t going in and out of these funds. These socially responsible ETFs offer investors the ability to take a diversified position without the need for single stock picking.
On the whole, advisers are using ETFs in a range of ways to help socially conscious investors address unique circumstances and achieve highly specific goals. And investors can expect options in this domain to keep expanding in coming years. The way ETFs are structured allows them to give more specialized offerings, especially in areas where average investors have not had the opportunity to invest before, such as commodities, currencies and precious metals. They are popular for their transparency, liquidity, and tax efficiency. Because of this, providers are offering more for investors.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.