5 Best Robo Advisors for Managing ESG Funds – Business Advice and Resources

5 Best Robo Advisors for Managing ESG Funds

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Environmental, social and governance funds, or ESG, belong to the family of sustainable, responsible and impact investing, sometimes referred to as SRI. This alphabet soup of investment strategies is a newer investment approach that strives to generate high long-term returns and positive societal results.ESG investing can be accomplished by investing in individual stocks and bonds, specifically targeted SRI funds, and employing a digital or a robo investment manager who specializes in this approach.From minimal ESG investing opportunities in the 1990s to about $12 trillion in assets under management in 2017, socially responsible investing is growing in popularity. The US SIF Foundation's most recent biennial report found that one in four dollars of professionally managed funds is directed toward ESG investing. (https://www.ussif.org/sribasics)Not only individual investors but credit unions, community banks hospitals, foundations, religious institutions, venture capitalists and public pensions invest in ESG investing companies.Answering to public demand, robo advisory digital investment managers, a type of nonhuman advisor, are now in the movement.The best ESG robo advisor will incorporate SRI investing criteria that matter to you, the opportunity to customize the investment options and low fees. Here are five of the best ESG robo-advisor services:M1 Finance.Betterment.EarthFolio.Wealthsimple.Motif Impact Portfolios.M1 FinanceThis unique platform offers both managed robo advisors and do-it-yourself investing under one roof. Investopedia's editor in chief, Caleb Silver, (https://www.linkedin.com/in/caleb-silver-9639585/) OK on this source this time. But Investopedia is one of our direct competitors so please avoid in the future.ranks M1 as a top ESG platform. "They have two socially responsible portfolios made up of Nuveen ETFs, listed under Expert Pies or you can construct a collection of stocks that meet your criteria." The account minimum is $100 and there are no trading fees, provided an account has at least a $20 balance. Experts say M1 Finance is unique among the SRI robo advisors in that it doesn't charge any management fee to use the platform.BettermentBetterment customers can choose to invest in their SRI portfolios with low fees and strong socially responsible metrics. This investment choice adheres to Betterment's low-cost and diversified approach while increasing exposure to companies that meet delineated SRI criteria. The Betterment socially responsible investing avoids companies with unsavory corporate governance and unfair labor practices."We'll prioritize excluding inappropriate stocks from the SRI portfolio and replace them with companies deemed to have strong social responsibility practices such as Microsoft (ticker: MSFT), Google (GOOG, GOOGL), Procter & Gamble (PG), Merck (MRK), Coca-Cola (KO), Intel (INTC), Cisco (CSCO), Disney (DIS) and IBM (IBM)," says Adam Grealish, Betterment's director of investing(https://www.linkedin.com/in/adamgrealish/) thank you. For example, in the U.S. large-cap stock allocation, selections include the iShares MSCI KLD 400 Social ETF (DSI). Betterment's low 0.25% management fee is reasonable when compared to other robo advisors and financial planners.EarthFolioEarthFolio is one of a handful of SRI investing robo advisors. This robo advisor invests exclusively in funds classified as sustainable or responsible. To make the cut, the fund's prospectus must delineate the specific ESG criteria used in the stock or bond selection. Unlike some ESG robo advisory competitors, EarthFolio offers bond funds in addition to other ESG funds.Earthfolio requires a $25,000 minimum investment amount and thus may be out of reach for new investors. EarthFolio offers a wider range of ESG investments and also provides a free head-to-head comparison of an investor's current portfolio with the EarthFolio recommendation. With a 0.5% management fee, it is one of the more expensive SRI investment robo advisors, although it compares favorably with traditional financial advisory fees.https://www.earthfolio.net/FAQ/WealthsimpleThere are a few fund names in this graph that don't match up with the tickers that you've given. Take a look. I've provided a few links, too.Launched in 2017, this Canadian robo advisor also operates in the U.S. and the U.K. The SRI options include ETFs representing iShares MSCI ACWI Low Carbon Target ETF (CRBN), Invesco Cleantech ETF (PZD), iShares MSCI KLD 400 Social ETF Is this what you mean?YES, SPDR SSGA Gender Diversity Index ETFIs this what you mean?yes (SHE), Invesco Taxable Municipal Bond ETF (BAB For BAB I'm getting this fund: https://money.usnews.com/funds/etfs/long-term-bond/invesco-taxable-municipal-bond-etf/bab. So do you mean BAB?yes-Investco Taxable Municipal Bond ETF) and iShares GNMA Bond ETF (GNMA) For GNMA, do you mean https://money.usnews.com/funds/etfs/intermediate-government/ishares-gnma-bond-etf/gnma YES iShares GNMA Bond Fund . Around 25% of Wealthsimple's clients have socially responsible portfolios.Wealthsimple offers three investment levels with management fees ranging from 0.4% to 0.5% of assets under management. All Wealthsimple clients have access to financial advisors, and halal portfolios are available for those who want to align their portfolios with Islamic religious beliefs.Motif Impact PortfoliosMotif Impact Portfolios encompasses both robo advisory services, investing in theme-driven portfolios, and more. One of the earlier platforms to use data and analytics to find unique investment opportunities, there are managed portfolios and DIY investing options.Silver recommends the Motif Investing Impact Portfolios which are populated with individual ESG stocks not exchange-traded funds. The ESG offerings fall into one of the categories: sustainable planet, fair labor and good corporation behavior.Motif requires a $1,000 minimum investment amount and charges 0.25% in management fees. The Motif Impact Portfolios offer stocks from five distinct asset classes that adhere to tax-aware rebalancing and minimize asset sales. In addition to the preselected ESG offerings, investors may create their own collections of ESG stocks.More Socially Responsible ESG Robo-AdvisorsThe following list includes other ESG investing companies in alphabetical order: Axos Invest.Ellevest.OpenInvest.Personal Capital.SustainFolio.TIAA Personal Portfolio.More socially responsible robo advisors will likely be added as the socially responsible investing field expands. For those who are seeking a set it and forget it socially responsible platform, there are many SRI robo advisor options from which to choose. It's likely that even if a current robo advisor lacks socially responsible investing choices today, it will offer it in the future. Ultimately, as younger investors more frequently seek to match their money with their hearts, the robo advisory market will continue to meet their needs.

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