A slew of recent polls, studies, and surveys confirmed the importance and relevance of ESG investing to younger investors.
For advisors and fund issuers alike, those are coveted demographics. Their commitment to ESG and values-based investing is clear. A recent US Bank survey indicates that they will sacrifice returns if it means doing right via their investment selections.
Thanks to ETFs such as the Invesco ESG Nasdaq 100 ETF (QQMG) and the Invesco ESG NASDAQ Next Gen 100 ETF (QQJG), ESG-inclined investors don’t need to make that tough choice.
Granted, a year-to-date timeframe isn’t lengthy, but on that basis, QQMG is slightly outperforming its non-ESG counterparts – the Invesco QQQ Trust (QQQ) and the Invesco NASDAQ 100 ETF (QQQM). To its credit, QQJG is outpacing the Invesco NASDAQ Next Gen 100 ETF (QQQJ) by about 230 basis points this year.
QQMG, QQJG Could Be Embraced by Young Investors
The performance data highlighted above confirm that there are ESG options out there for all investors. Regardless of age, you don’t need to leave returns on the table to invest in accordance with your values.
Still, some market participants are willing to make that sacrifice. Advisors may want to highlight the potential benefits of QQMG and QQJG to younger clients. The US Bank survey indicates 67% of Gen Zers and 59% of millennials want to invest in accordance with personal beliefs. They are willing to sacrifice returns to accomplish that objective.
“And active young investors are willing to give up returns to see that goal through. The survey found more than four-fifths of Gen Z and millennials would be willing to underperform the S&P 500′s 10-year average return of 12% to ensure that the companies where they’ve invested align with their belief systems. Only 73% of Gen X and 65% of boomers said the same,” reported Hakyung Kim for CNBC.
Further highlighting the potential relevance of QQJG and QQMG to younger investors, some of these market participants are willing to go to considerable extent to invest in alignment with their values.
“Nearly a fifth of the Gen Z investors said they would accept returns between 9% and 11.8%, rather than the full 12% average return. Nearly 30% would take between 6% and 8.9%, while another 30% would accept returns between 3% and 5.9%,” according to CNBC.
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