Ethical fund proves a turkey
Sunday 26 December 1999
Investors who put pounds 100 into the fund in 1989 would have made a profit: their investment would be worth pounds 240.84 today. But the same amount invested in the FT-SE All Share index would have reaped pounds 412.95.
Simon Males, business development manager at Friends, Ivory and Sime, the investment house which runs the Stewardship fund, argues that the findings are unfair because the FT-SE All Share is not the best benchmark to use to measure performance.
"One of the key factors that differentiates the fund from other UK equity funds is that the Stewardship is constrained by its ethical criteria," he says. "There is a 50:50 exposure between large and small-cap companies, while the FT-SE All Share is very differently weighted, focusing primarily on larger companies."
Instead, Friends Provident uses a composite index of the FT-SE All Share and the Hoare Govett Smaller Companies index to measure the performance of the fund.
But the findings are bad news for fund managers who have worked hard to make environmentally friendly investments credible. Launched in 1984, the Stewardship fund was the UK's first ethical fund. Although it got off to a slow start, with people dismissing ethical investing as cranky and suitable only for the "brown rice and sandals" brigade, pounds 3bn is now invested across 40 UK ethical funds.
The question is whether investors will be so keen to follow their conscience once they realise that it is not as good for the pocket.
But the Stewardship fund was not the worst performer of the decade. That dubious honour goes to the MGM Special Situations Growth fund. This underperformed the FT-SE All Share by 63 per cent over 10 years.
- 1 Scottish independence: Ireland since 1919 is a lesson for Scotland in what a Yes vote means
- 2 British tourists 'murdered' in Thailand: Pair's bloodied bodies found naked on Koh Tao beach
- 3 Lego breaks out of the toy box and heads for the gallery
- 4 Vogue under fire for 'Big Booty' article
- 5 Julian Assange and Edward Snowden join piracy mogul Kim Dotcom’s political campaign in New Zealand
British tourists 'murdered' in Thailand: Pair's bloodied bodies found naked on Koh Tao beach
Russia freezes Ukraine into submission: Kiev admits country doesn't have enough fuel for winter
Jihadi John': MI5 may have identified Isis militant who killed David Haines but options limited
Scottish independence: Police will be on high alert on Friday whatever the result
David Haines beheading: David Cameron says Britain will hunt down Isis 'monsters' shown in video murdering aid worker
Daniele Watts: Django Unchained actress detained by Los Angeles police after being mistaken for a prostitute
The political class is doing what Hitler couldn’t – destroying Britain
Scottish independence: Nationalist leader Jim Sillars threatens pro-union companies with 'day of reckoning' after independence
Scottish independence: Yes campaign feels the heat as Alex Salmond's NHS claims come under furious attack
£23m Birmingham cycle scheme is attacked by Tory councillor for not catering to the elderly
Salmond accused of laughing off national debt with ‘what are they going to do: invade?’ joke
iJobs Money & Business
£280 - £320 per day: Ashdown Group: The Ashdown Group have been engaged by a l...
£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...
£35000 - £38000 per annum + Benefits: Ashdown Group: Training Coordinator / Pl...
Data Governance Manager (Solvency II) – Contract – Up to £450 daily rate, 6 month (may go Permanent)
£400 - £450 Per Day: Clearwater People Solutions Ltd: We are currently looking...