Strategies for Sustainable Portfolio Construction | ETF Trends

Socially responsible investments are more than just a feel-good theme. They provide investors with exposure to environmental, social and governance principles that could enhance a portfolio without sacrificing returns.

On the upcoming webcast, Strategies for Sustainable Portfolio Construction, Benjamin Lavine, Chief Investment Officer, 3D Asset Management; Austin Fitch, Senior Analyst, Horizon Investments; Scott Ladner, Chief Investment Officer, Horizon Investments; and Sean Edkins, Head of ETF Sales and Strategic Partnerships, DWS, will outline ways for financial advisors to fine tune selections and diversify with a sustainable portfolio design.

For example, the Xtrackers MSCI USA ESG Leaders Equity ETF (NYSE Arca: USSG) has been a popular play for investors seeking exposure to socially responsible investments. USSG was developed in collaboration with Ilmarinen, Finland’s largest pension insurance company. The underlying MSCI USA ESG Leaders Index provides exposure to large- and medium-cap U.S. companies with high environmental, social and governance (ESG) performance relative to their sector peers.

Other options include the Xtrackers MSCI EAFE ESG Leaders Equity ETF (NYSEArca: EASG), Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (NYSEArca: EMSG) and Xtrackers MSCI ACWI ex USA ESG Leaders Equity ETF (NYSEArca: ACSG). The ETFs try to provide exposure to companies with high ESG-related performance relative to their sector peers. The underlying index is based on MSCI ESG Ratings, MSCI ESG Controversies and MSCI Business Involvement Screen Research to determine index components.

Additionally, the more recently launched Xtrackers S&P 500 ESG ETF (SNPE) is among the first ETFs to track the S&P 500 ESG Index, the environmental, social and governance derivative of the widely followed S&P 500 Index. SNPE’s underlying index seeks to target 75% of the float market capitalization of each Global Industry Classification Standard Industry Group within the S&P 500 Index, using an ESG score as the defining characteristic.

Financial advisors who are interested in learning more about ESG-factor investments can register for the Thurday, November 21 webcast here.