ESG Case Study: Top 1000 Value
Among our many tests, we made an effort to test our methodology on approximations of popular benchmark indices. This study simulates an ESG-weighted Top 1000 Value portfolio (blue) versus the same portfolio weighted by market-cap (red). Our starting universe is the top 1000 US companies by market-cap that are also in the Wilshire Large- or
ESG Case Study: More Tinkering with the Top 1000
OWL ESG continues to publish case studies that convince us of ESG’s potential to improve investments. We will be releasing these updates regularly, and will present additional studies and analysis in our newsletter — take a second to sign up to receive this additional valuable information. This week we use the same starting universe as
ESG: Not Just for Hippies
At a recent conference we discussed ESG reporting with a number of financial advisors. One, who identified himself as fiscally conservative, appeared to take great pleasure in describing us as bleeding-heart liberals who were trying to complicate investment decisions with an arbitrary do-gooder philosophy. To which we reply: Balderdash. OWL ESG is proud to promote
ESG Case Study: Adding a Filter
Our series of case studies continues! Today we look at a simulated large-cap portfolio of the 1000 largest US companies, charting the comparison between two different weighting schemes. The red line represents a market cap-weighted portfolio, which is just that: constituents are weighted by their market capitalization, with no filtering or other factors. The blue
How Do We Know ESG Works? Let Us Show You.
At OWL ESG we do a lot of evangelizing about the benefits of using environmental, social, and governance (ESG) data in investing. Why? Because we’ve seen it at work. Our head of product development recently re-ran our original ESG case studies with a refreshed data set. The results have only strengthened our conclusions. Since we’ve been
How Can an Individual Investor Get Started with ESG?
Now that the general public is becoming aware of ESG (environmental, social, and governance) investing, we hear this question all the time: Q: How can an individual investor get started with ESG? A: If you’re already investing in mutual funds or ETFs, it’s easier than ever to find investments that reflect your goals. Most investors
Worried About Deregulation? Take the Reins with ESG
The new administration’s rapid pen-strokes currently underway in Washington DC promise to change how business is done, particularly as executive orders aim to reduce business regulations. Whether you favor such regulation (or, like some, are concerned about regulations’ ineffectiveness and unintended negative effects), the rapid and widespread fluctuations in our federal system will ripple far, creating
Question of the Day: ESG & Exclusion
Here’s a question we hear occasionally from investors who are just getting started with ESG. Q: Doesn’t investing with ESG imply the elimination of companies from your starting universe? A: Au contraire. The majority of professional investors know that ESG is not an investment strategy. Straight up, it’s data and information that investors can use
Can You Afford to Ignore ESG?
A new study suggests many investors are missing out on the benefits of ESG because they — or their advisors — don’t understand why or how to use it. Despite growing evidence, over a third of survey respondents do not think ESG is an alpha source, and another third aren’t sure. That leaves less than a
Investor Demand Drives Growth of Sustainable Investing
Sustainable and responsible investing continues to claim a growing portion of investments in the US, now at over one-fifth of professionally managed assets — that’s $8.72 trillion out of $40.3 trillion — up 33% from one-sixth in 2014. “Client demand is one of the major drivers for money managers that introduce products that take ESG
The Natural History of ESG
The investing world is fast embracing ESG data to inform investment decisions — likely because, as stacks of studies show, on the whole ESG scores are an indicator for performance. But what is this information? Why is it important? Where does it come from? Is all ESG alike? In short, how is ESG made? Don’t
ESG is Not an Investment Strategy
We keep seeing articles fingering ESG for the sub-benchmark performance of some socially responsible investment (SRI)-themed funds. That’s like cursing the hammer for your sore thumb when you’re the one swinging it. That the terms ESG and SRI have become so popularly confused is not just unfortunate; it is wrong, and this mistake can be
