August 2021
Today everyone speaks about sustainability and saving the Earth.
Ten years ago many were still ridiculing Prince Charles for the things he said that now show him to be evolutionary. Well it was 10 years ago that we set up our first five risk rated Ethical Portfolios and my, how things have changed.
In the early years many people saw them as the investment choice of sandal wearing, tree huggers and take up was low. The choice of companies to invest in was limited and costs were higher. Today, all this has changed, and these same people are seen as evolutionary. Clients today usually start from the view point that they want to be Ethical in their investing and, whilst the majority of clients have not switched over to the Ethical Portfolios, many have and it’s fast becoming the portfolio of choice. We still only have just around £80 million in our Ethical Portfolios, but this figure is growing rapidly.
Fund growth/performance has been strong for a number of years, and compared to the industry professionals we have measured very well, beating all twice in recent years and achieving second in another when we were not top. Our Investment Manager, Rachel, who has been overseeing the portfolio for the last 7 years has used processes established in our internal investment team to great effect, and whilst the last 10 years has seen markets hit by Brexit as well as an oil crisis, international trade wars, currency devaluations and the recent Covid crash of March 2020, the average risk portfolio has still achieved 111% (as of 30/06/21) which is an average of 7.77%, our cautious portfolio has achieved 95.01% and our high risk portfolio achieved 146.04%. This compares, over the same period, with the FTSE achieving 73.03%. (Funds can go down as well as up and past performance is no guarantee of future performance).
It’s true that an Ethical portfolio has extra share screening costs, but now processes have moved on over the last 10 years the difference is small. Our own fees are the same regardless, as we have never charged extra.
It takes a long time to really understand the science of Ethical investing, and whilst past performance is no guarantee of future returns, we have done well, even if I do say so myself. The “we” of course is the royal we, as I have little influence in the funds chosen and fund switches made.
