Displaying items by tag: esg

Strive Asset Management has launched direct indexing services on Fidelity and Schwab platforms, reaching a broad retail audience. These services emphasize daily tax-loss harvesting and pro-shareholder governance, avoiding ESG or DEI constraints. 

Powered by Vestmark’s VAST technology, the initiative aligns with Strive’s anti-ESG philosophy, aiming to deliver superior financial outcomes for clients. CEO Matt Cole highlighted the unique value of Strive’s approach, citing frequent drawdowns in large-cap equities that offer tax-harvesting opportunities. 

Founded in 2022 by Vivek Ramaswamy, now a key figure in President-elect Trump’s administration, Strive manages $1.7 billion in assets. Its ETFs focus purely on financial returns, contrasting with ESG-oriented funds by voting against ESG shareholder proposals.

Finsum: ESG and DEI oriented funds will have an uphill battle against the trump administration. 

Renewable energy stocks, once at peak valuations in 2020-21, are struggling with investor pullbacks and face extended uncertainty partly due to U.S. election concerns. Interest in the sector has been eroded by competition from Chinese renewables, strong returns on conventional energy, and issues like supply chain disruptions and grid connection challenges. 

Although the Inflation Reduction Act has supported renewable investments in the U.S., analysts warn that the potential return of Donald Trump to office could redirect funds to fossil fuels, while a win for Democrat Kamala Harris might revive confidence in renewables. 

Even with lower interest rates, a new boom on the scale of 2020-21 is unlikely, as renewable growth has slowed. The sector has seen 17 consecutive months of net outflows, losing over $11 billion in 2024 alone, with major funds like the iShares Global Clean Energy ETF losing 28% in unit numbers. 

Finsum: There could be a serious opportunity to find value in these ETFs at the current price levels. 

According to new research from BNP Paribas and Coalition Greenwich, investors are increasingly focused on strategies that drive both growth and positive societal impact. Thematic investing, which identifies long-term trends related to technology, demographics, and sustainability, has gained popularity, with 63% of respondents prioritizing impact and sustainable outcomes. 

Thematic strategies are especially appealing in areas like artificial intelligence, clean energy, and water management. European investors are leading in the adoption of these strategies, with participation growing from 46% to 61% since 2020. 

Themes like gender diversity, demographic inequalities, and mobility are also gaining attention. As the economic landscape evolves, thematic investments are becoming a preferred way for investors to align their portfolios with future trends.

Finsum: Thematic investing can be a wonderful way to connect with clients, and to dive deep into their interests in the portfolio construction

A JPMorgan executive has downplayed the influence of the political pushback against environmental, social, and governance (ESG) issues in the U.S., stating that it has minimal impact on the country's green economy. 

Chuka Umunna, JPMorgan’s head of sustainable solutions, explained that although discussions around sustainability have quieted, U.S. investors are still allocating capital in ways similar to their European counterparts. He stressed that despite the politicization of ESG, the underlying investment behavior remains largely the same, though the terminology may differ. 

Umunna pointed out that while there has been an increase in anti-ESG resolutions, the vast majority failed to pass, with less than 2% succeeding. He added that the primary obstacles for U.S. businesses are more related to inflation, supply chain disruptions, and high interest rates than ESG challenges.

Finsum: While there is little doubt that ESG has slowed down, the long-term viability of these strategies is very clear

Rising interest in commodities like gold, oil, and grains, fueled by concerns over inflation and climate change, is impacting the design of fixed indexed annuities and registered index-linked annuities. This shift appeals to clients seeking hedges against inflation and additional asset diversification. 

While traditional indices like the S&P 500 dominate annuity allocation options, commodity indexes are emerging as viable alternatives, offering potential returns between 3% and 5.5% annually. Index exposure varies, with some annuities offering direct access to single commodities, like gold, while others provide diversified commodity index options. 

The inclusion of these indexes signals a broader trend toward more diversified and defensive investment strategies within annuity products, catering to clients' evolving needs in a changing economic landscape.

Finsum: These annuities could provide a natural way to get industry exposure and hedge against key issues like inflation.