Page 40 - DIY INVESTOR MAGAZINE - NOVEMBER 2018
P. 40

       I posed the same question to my female Facebook community out of curiosity. This group is full of intelligent professional women of a wide variety of backgrounds, occupations and ages who are interested in personal finance. A more financially-savvy crowd perhaps? Would the same reasoning apply to them too?
Sure enough, lack of spare money, lack of understanding and concern over losing money were all reasons cited for not wanting to invest. However one reason stood out to me in particular and had me intrigued.
THE REASON THIS WOMAN GAVE?
Essentially she was talking about the lack of perceived ‘ethical’ investing options. Bingo.
I DON’T LIKE THE IDEA OF MY MONEY GOING TO COMPANIES THAT CAUSE MORE HARM THAN GOOD IN THE WORLD
COULD ETHICAL INVESTING BE THE KEY?
Ethical investing is NOT a new phenomenon. Modern Muslims who follow Sharia law (which goes back centuries) are absolutely not allowed to invest in any company that has dealings with tobacco, alcohol, armaments, gambling, pork, pornography or drugs.
This then poses the problem – how do people who follow Sharia Law build savings or invest their money without investing in companies that are strictly not allowed?
Well of course the answer is ethical investing! Companies who manage the money of people who follow Sharia Law have strict criteria for where money can be invested. If it goes against the Law, then it is not included.
For many women, they too would like to put their money into worthwhile causes and would make them feel happier to invest.
This concept is so important to them that they’d rather not invest at all for fear of giving money to something they do not agree with.
This means that the traditional investment landscape NEEDS TO CHANGE to accommodate their choices. Thankfully it is starting to.
WHAT’S OUT THERE NOW?
Ethical and more conscious-style investing is a new, but growing market. It’s hardly surprising that they are more expensive by comparison than say, the FTSE 250 (0.85-1% per annum vs. 0.09%-0.18% respectively) but with time this is likely to improve, especially as demand increases.
This is Money have an interesting article about some funds and bonds that are looking at ethical companies, and Hargreaves Lansdown have created a list of funds that have become available.
However, the funds listed are also expensive by comparison to traditional investment funds (the passive kind at least).
In addition to this, Triodos Bank is offering ethical funds and peer-to-peer lending options. Triodos say that they are the only specialist bank to offer integrated lending and investment opportunities for sustainable sectors in a number of European countries. So if they can do it, where is everyone else?
WHAT ELSE IS COMING?
Well I’m glad you asked.....I have recently been using a NEW feature on a robo-app called Plum. Plum started life as a savings-app in a bid to get more people saving without much effort on their part. It’s incredibly effective and becoming more and more popular.
They are now also allowing individuals to INVEST some of those savings into funds starting from as little as £1. The options include a purely ethical fund. It is still in
a kind-of beta phase at the moment, with individuals needing to apply to a waiting list.
    DIY Investor Magazine | Dec 2018 40













































































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