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Ethical alternative to the likes of Black Rock, Vanguard, Fidelity etc

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  • JohnWinder
    JohnWinder Posts: 1,862 Forumite
    Fifth Anniversary 1,000 Posts Name Dropper
    edited 21 June 2023 at 1:19AM

    Mmm. Not sure. Companies fund their operations with income from sales, capital raising by selling equity, and borrowing. You only addressed ‘buying shares’, but the OP implied shares and bonds ie borrowing.

    If the buyers of equity and the lenders of debt dry up it puts downward pressure on a share price and upward pressure on borrowing expense. When it comes to fund future operations, selling equity won’t bring in much if the share price is well down unless you sell most of the company (diluting the value of other shareholders’ favourite holding); and issuing bonds with a higher yield than other businesses pay will hurt. That leaves greater reliance on funding from sales. I’d guess the relative contribution of those three funding sources will vary from business to business etc, but you get the pictures I imagine.

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