Daily Money Tip: For 'green' investor, a multihued approach advised

Pax World offers a "fossil fuel-free" fund. "There is no perfect solution," its CEO says. ". . . Only solutions."
Pax World offers a "fossil fuel-free" fund. "There is no perfect solution," its CEO says. ". . . Only solutions."
Posted: January 07, 2014

Want to "green" your portfolio? You can invest in mutual funds that keep an eye on the environment by owning shares in companies that, say, treat wastewater used in the "fracking" of natural gas, one of Pennsylvania's booming industries.

Pax World is just one of several mutual fund outfits that offers what's known as a "fossil fuel-free" mutual fund, one that includes investments in energy efficiency, alternative energies like solar and so-called low-carbon technologies.

Joe Keefe, president and CEO of Pax World Management, based in Portsmouth, N.H., recommends "a multipronged approach. We can't let the perfect strategy become the enemy of the good strategy."

You can divest fossil fuels and still own a portfolio that remains very carbon-intensive, he notes. Or you can fight fossil-fuel companies with public policy "until the cows come home and make no discernible progress. There is no perfect solution; there are only solutions," he told GreenMoney Journal this month.

The Pax World Global Environmental Markets Fund (symbol: PGRNX) is one way; the fund currently does not invest in fossil-fuel companies. Formerly the Pax World Global Green Fund, it holds renewable-energy and energy-efficiency companies, water infrastructure, pollution control, and waste management.

These socially responsible investment funds aren't always cheap. Pax World Global Environmental charges annual fees of 1.4 percent, and sometimes a sales "load" (read: big fee) of about 5 percent.

Ask your broker whether those management fees can be reduced and the sales load waived if you decide to invest.

Even moguls miss

Berkshire Hathaway, the $292 billion company founded by investment guru Warren Buffett, likely failed to beat the Standard & Poor's 500 Index during the last five years, according to Bloomberg data.

It would be the first time the billionaire investor fell short of that goal since he took over the Omaha, Neb.-based company in 1965.

Buffett, 83, is known to outperform in bear markets. But the S&P 500 returned 128 percent including dividends since the end of 2008, propelled by the Federal Reserve's fiscal stimulus and higher corporate profits. Berkshire's Class A share (BRK/A) rose 80 percent to $126,766 starting at the same point until Sept. 30, the latest date for which data are available.


erinarvedlund@yahoo.com

646-797-0759

comments powered by Disqus
|
|
|
|
|