In recent years, ethical investing has gained momentum as more and more investors are looking to align their financial goals with their moral values. One of the most popular ways to do this is by investing in ethical funds, which are mutual funds that only invest in companies that meet certain environmental, social, and governance (ESG) criteria. These criteria can vary widely, but they often include factors such as sustainability, diversity, labor practices, and ethical business practices.
Investing in ethical funds can be a great way to not only make a positive impact on the world, but also potentially earn solid returns. In fact, many studies have shown that companies that score highly on ESG criteria often outperform their peers in the long run. With that in mind, let’s take a look at some of the best ethical funds currently available.
1. Vanguard FTSE Social Index Fund (VFTSX)
The Vanguard FTSE Social Index Fund is a popular choice for investors looking to invest in socially responsible companies. The fund tracks the performance of the FTSE4Good US Select Index, which includes companies that meet a set of ESG criteria. With a low expense ratio and solid performance history, this fund is a great option for investors looking to make a positive impact without sacrificing returns.
2. Parnassus Core Equity Fund (PRBLX)
The Parnassus Core Equity Fund is another top choice for investors interested in ethical investing. This fund focuses on companies with strong ESG profiles and aims to outperform the S&P 500 over the long term. With a team of experienced portfolio managers and a track record of strong performance, the Parnassus Core Equity Fund is a solid option for investors looking to make a difference with their investments.
3. Calvert Equity Fund (CSIEX)
The Calvert Equity Fund is a socially responsible mutual fund that invests in companies with strong ESG practices. The fund focuses on companies that are leaders in areas such as sustainability, diversity, and corporate governance. With a relatively low expense ratio and a long history of outperforming its peers, the Calvert Equity Fund is a great option for investors looking to align their investments with their values.
4. TIAA-CREF Social Choice Equity Fund (TISCX)
The TIAA-CREF Social Choice Equity Fund is a socially responsible mutual fund that aims to invest in companies that are leaders in ESG practices. The fund focuses on companies that have strong environmental records, diverse workforces, and ethical business practices. With a solid track record of performance and a low expense ratio, the TIAA-CREF Social Choice Equity Fund is a great option for investors looking to make a positive impact on the world.
5. Green Century Balanced Fund (GCBLX)
The Green Century Balanced Fund is a unique option for investors looking to invest in environmentally friendly companies. This fund invests in a mix of stocks and bonds of companies that meet strict environmental criteria. With a focus on sustainability and responsible investing, the Green Century Balanced Fund is a great option for investors looking to make a difference with their investments.
6. Domini Impact Equity Fund (DSEFX)
The Domini Impact Equity Fund is a socially responsible mutual fund that focuses on companies with strong ESG profiles. The fund invests in companies that are leaders in areas such as sustainability, diversity, and corporate governance. With a solid track record of performance and a low expense ratio, the Domini Impact Equity Fund is a top choice for investors looking to make a positive impact with their investments.
In conclusion, ethical investing has become increasingly popular in recent years as investors seek to align their financial goals with their values. Investing in ethical funds can be a great way to make a positive impact on the world while potentially earning solid returns. The best ethical funds, such as the Vanguard FTSE Social Index Fund, Parnassus Core Equity Fund, and Calvert Equity Fund, offer investors the opportunity to invest in companies that meet strict ESG criteria and have a track record of strong performance. By choosing one of these funds, investors can make a difference while also potentially growing their wealth.