Ethical Investing

Izzy_Skint_2

:A Hello All,

I want to transfer £5000.00 out of my current cash ISA into an ethical fund. Ethical in as much as a fund that lends itself to sustainable energy generation via sustainable means. I really do feel that such sectors will reap good returns in the future due to this countries commitment for such energy sources now and in the future.

Firstly, is this a safe assumption to make and if so, does anyone know of any funds that can meet my needs in this respect.

Many Thanks

Iz

turbobob

Hi I think that it is inevitable that sustainable energy methods will increase in importance in the future. It is a fact that oil is running out, and other fossil fuels are finite in supply...

But there are a few points I would consider

- Investing your portfolio in one single themed sector is very high risk.
- Don't put all your eggs in one basket.
- Its likely that a lot of companies specialising only in renewable energy will be small caps. Smaller companies carry a higher risk of failing.
- I would guess that actually, a lot of research on sustainable energy will be done by companies not normally seen as "ethical" and probably not qualifying for inclusion in the specialist funds - oil giants, car makers etc.

I've not looked into specific funds investing in this sector myself. A quick search has found funds like the BlackRock New Energy Trust which looks reasonable, but obviously you should do your own research. I would start off by searching on sites like Trustnet or Morningstar on some key words (sustainable, renewable, green, energy etc) and go from there.

ukdutypaid

I've got the L&G 'Ethical' ISA. It's funny though because it has the likes of HSBC and Vodafone in it.... Now there's ethical and ethical.. Just because they don't actuallly make anti personnel land mines, seems to make them ethical...

Actually here's the Top 10 Holdings % Port

Vodafone Grp 9.40
BG Grp 5.81
Royal Bank of Scotland Grp 5.03
BHP Billiton 4.88
Tesco 4.40
Xstrata 3.81
Lloyds TSB Grp 3.76
National Grid 2.59
BT Grp 2.55

Prudential 2.42

ukdutypaid

I've got the L&G 'Ethical' ISA. It's funny though because it has the likes of HSBC and Vodafone in it.... Now there's ethical and ethical.. Just because they don't actuallly make anti personnel land mines, seems to make them ethical...
Read the list of holdings and smile.. No need to wonder why it's not doing very well, either...

Top 10 Holdings % Port

Vodafone Grp 9.40
BG Grp 5.81
Royal Bank of Scotland Grp 5.03
BHP Billiton 4.88
Tesco 4.40
Xstrata 3.81
Lloyds TSB Grp 3.76
National Grid 2.59
BT Grp 2.55

Prudential 2.42

greenbee

Try Triodos (www.activatemoney.com) for an ethical ISA. There's lots of detail on where you money will go, so you'll also know where it isn't going! Ethical investing can be done either by screening for negatives (so no arms, tobacco, alcohol etc, depending on what the company sees as ethical/unethical), or by looking for postive investments as with Triodos, the Ecology Building Society etc.

turbobob

ukdutypaid wrote: »

I've got the L&G 'Ethical' ISA. It's funny though because it has the likes of HSBC and Vodafone in it.... Now there's ethical and ethical.. Just because they don't actuallly make anti personnel land mines, seems to make them ethical...

Actually here's the Top 10 Holdings % Port

Vodafone Grp 9.40
BG Grp 5.81
Royal Bank of Scotland Grp 5.03
BHP Billiton 4.88
Tesco 4.40
Xstrata 3.81
Lloyds TSB Grp 3.76
National Grid 2.59
BT Grp 2.55

Prudential 2.42

Seems very much like the makeup of any number of UK equity funds. Probably BAT (British American Tobacco) and oil companies would normally be in the top holdings somewhere and they are excluded because it's "ethical"?

Masomnia

So basically you invest in the big banks, so they can invest more in tobacco and arms etc.?

Seems silly to me.