Staying on top of the latest investing trends can seem like a learning a new language.
For one thing, there’s an alphabet soup of terms to understand — from alpha to beta to passive investing to socially responsible investing to values-based investing. Even when the individual words make sense, it’s not always clear what they mean.
Yet with $8.7 trillion of professionally managed funds in the U.S. being directed toward socially responsible investing — out of a total of $42 trillion of total professionally managed assets — according to 2016 figures from the Forum For Sustainable And Responsible Investing (US SIF), it’s obviously more than a passing trend.
But what exactly is socially responsible investing and why should you care about it? Equally important, what isn’t it?
Impact investing isn’t just for nonprofits or state and local governments. Venture capital is on board, too.
Nancy Pfund, Founder and Managing Partner of DBL Partners, pursues a “double-bottom line,” aiming for “top-tier financial returns” while working closely with individual portfolio companies to help them optimize social contribution, climate effects and community engagement.
For her, it’s a matter of putting first things first: “You have to really believe it’s going to be a successful financial investment first and foremost.”
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