When the economy hits the skids, everyone gives up idealism and gets back to investing in the basics. Nobody’s got the stomach for hippy-dippy tree hugger funds, or so goes the standard theory.
Not so says, Ingrid Saukaitis Dyott, co-manager of Neuberger Berman Socially Responsive Fund (NBSRX) who tells the Journal she still sees cash inflows into her fund, which is up .1% for the year. Compared to the S&P which is down 5%, that’s pretty good.
Here’s what it invests in: The Socially Responsive Fund initially screens out companies tied to tobacco, alcohol, gambling, nuclear power and defence — about 150 names out of a universe of 2,000, she says.
After that, firms with the strongest balance sheets and potential market share growth are subjected to an extra layer of research. For a manufacturer, that could mean close scrutiny of environmental practices. A tech company that relies on generating new products could be scrutinized for diversity policies in the workplace, Ms. Dyott says.
NBSRX recently invested in Canadian National Railway (CNI) and Praxair (PX), both up for the year.
Socially responsible investing might feel great, but losing money doesn’t. If her fund returns money, then people will stick with it. If it loses money, then people will get out.
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