Original, independent, thought leadership
Subscribe
Search Linkedin
Search Linkedin Reddit-alien
Search Linkedin Reddit-alien
Finance green background with numbers and graphs. Financial market concept. 3D render

Chart of the Week- May 16, 2022

Average performance of taxable green bond mutual funds and ETFs Jan. – April 2022Source:  Performance data:  Morningstar Direct; Sustainable Research and Analysis LLC Observations: Dedicated green bond funds, consisting of six taxable funds, including four green bond mutual funds and two green bond ETFs, reached $1.37 billion in assets under management at the end of…

Share This Article:

The Bottom Line:  Fixed income funds have come under increasing pressure Y-T-D and green bond funds have not been spared, but they have held up.

Average performance of taxable green bond mutual funds and ETFs Jan. – April 2022Source:  Performance data:  Morningstar Direct; Sustainable Research and Analysis LLC

Observations:

  • Dedicated green bond funds, consisting of six taxable funds, including four green bond mutual funds and two green bond ETFs, reached $1.37 billion in assets under management at the end of April.  The small segment sustained limited outflows in April on top of an estimated $47.2 million drop due to capital depreciation.  These numbers exclude the Franklin Municipal Green Bond Fund that was to be liquidated on or about May 6th and the launch of the rebranded Franklin Municipal Green Bond ETF as of May 3, 2022 that shifted $101.9 million into the green bonds segment.  
  • Fixed income funds have come under increasing pressure this year as expectations shifted for the path of monetary policy.  Green bond funds have not been spared, but they have held up well.  Taxable green bond funds (excluding the Franklin Municipal Bond Fund and its four share classes) posted an average drop of 3.34% in April that beat the Bloomberg US Aggregate Bond Index by 45 bps.    
  • Green bond funds, on average, gave up -8.98% since the start of the year.  This exceeded the total return results recorded by the conventional Bloomberg US Aggregate Bond Index, down 9.5%, by 52 bps.
  • While additional benchmarks are also relevant for relative performance evaluation purposes, such as narrowly focused green bond indices as well as global bonds in connection with funds that take on non-US dollar exposure, US bond investors will want to know how their green bond funds with investments that seek to achieve positive environmental outcomes are performing relative to an alternative conventional investment product consisting of intermediate investment-grade bonds.
YOU MAY ALSO LIKE

$99.99
PER YEAR

Premium Articles Access Priority Support 1 Fixed Price

Sign Up
Free Trial
30 Day

Access to All Data No Credit Card Required Cancel Any Time

Sign Up
9.99
Monthly

Access to Premium Articles Priority Support Save 25%

Sign Up
Sustainable Funds Monitor
ACCESS
Funds Glossary
ACCESS
Quarterly On-Line Briefings
ACCESS


Sign up to free newsletters.

By submitting this form, you are consenting to receive marketing emails from: . You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

Research

Research and analysis to keep sustainable investors up to-date on a broad range of topics that include trends and developments in sustainable investing and sustainable finance, regulatory updates, performance results and considerations, investing through index funds and actively managed portfolios, asset allocation updates, expenses, ESG ratings and data, company and product news, green, social and sustainable bonds, green bond funds as well as reporting and disclosure practices, to name just a few.

A continuously updated Funds Directory is also available to investors.  This is intended to become a comprehensive listing of sustainable mutual funds, ETFs and other investment products along with a description of their sustainable investing approaches as set out in fund prospectuses and related regulatory filings.

Getting started

Many questions have surfaced in recent years regarding sustainable and ESG investing.  Here, investors and financial intermediaries will find materials that describe the various approaches to sustainable investing and their implementation.  While sustainable investing approaches vary and they have thus far defied universally accepted definitions, many practitioners agree that they fall into the following broad categories:  Values-based investing, investing via exclusions, impact investing, thematic investments and ESG integration.  In conjunction with each of these approaches, investors may also adopt various issuer engagement procedures and proxy voting practices.  That said, sustainable investing approaches will continue to evolve.

In addition to periodic updates regarding sustainable investing and how this form of investing is evolving, investors and financial intermediaries interested in implementing a sustainable investing approach will also find source materials that cover basic investing themes as well as asset allocation tactics.

Inesting ideas

Thoughts and ideas targeting sustainable investing strategies executed through various registered and non-registered sustainable investment funds and products such as mutual funds, Exchange Traded Funds (ETFs), Exchange Traded Notes (ETNs), closed-end funds, Real Estate Investment Trusts (REITs) and Unit Investment Trusts (UITs). Coverage extends to investment management firms as well as fund groups. 

Independent source for sustainable investment management company research, analysis, opinions and sustainable fund disclosure assessments