How Does a Fund Screen Its Investments?
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How Does a Fund Screen Its Investments?
Once you decide which social responsibility screens are most important to you, it’s time to find the closest match. You might start by looking at Websites that provide details on socially responsible investing. The most complete Website of how SRI funds screen companies is the Forum for Sustainable and Responsible Investment.
Things To Know
- Look at Websites that provide details on socially responsible investing.
Accurate information about a fund family’s screening efforts is also often available on the firm’s Website. Moreover, prospectuses and annual reports carry basic information about the types of social screens that the funds use. SRI customer-service representatives should also be able to answer your questions. Finally, examine a recent portfolio of any SRI fund you’re seriously considering. Sure, a fund may say it uses environmental screens, but are those screens stringent enough for you? For example, one fund takes a relative approach to screening. That is, the managers look for the companies in each industry with the best workplace and environmental records. That means, however, that the fund owns an oil-exploration company. Investors seeking stellar environmental records may not be that comfortable owning even the most socially responsible oil-exploration firm.