Ethical Investing

A look at investing ethically and what it means.

James avatar
Written by James
Updated over a week ago

We know many of you have asked us about investing ethically through Chip.

So, with ChipX we're delighted to bring you funds committed to operating in a way that is sustainable for the future. In this article we'll take a further look at what this mean and how you can invest in the things that matter to you.

​Please note: Chip can't provide financial advice so you may want to seek guidance from a qualified professional if you are unsure or have detailed questions around investing. Your capital is at risk

So what are ethical funds? Ethical funds will look to only purchase shares or bonds from companies designated as being socially, environmentally and morally responsible and avoid organisations and sectors that have a negative impact on the planet and don’t align with the values of the individual choosing to invest.

These funds will be geared towards the advancement of “positive ESG characteristics” with potential for worthwhile environmental and social outcomes. e.g. a fund investing in clean energy technology. Environmental, Social, and Governance refers to the three key factors in measuring the sustainability and societal impact of an investment in a company or business.

Factors taken into consideration when applying ESG characteristics include contribution a company makes to climate change through carbon emissions, human rights and labour standards and if a corporation is being run in the right way.

Two of our funds offered through ChipX “Ethical X” and “Clean Energy” are guided by these principles with assets within this fund required to meet ESG related criteria. BlackRock have put together these funds and it is their view that these funds reflect positive ESG characteristics.

Ethical X:

Average annual return: 13.00%*

Risk rating: 5/7

Official name: MyMap 5 Select ESG Fund

Clean Energy:

Average annual return: 27.51%*

Risk rating: 6/7

Official name: iShares Global Clean Energy UCITS ETF

It's important to note sustainable, or ESG-focused investing carries risks like any other investments, yet emerging trends show that investors can take a sustainable approach while pursuing traditional financial goals.

* Annualised average performance over the last 5 years, net of fund manager fees. Or if less than 5 years old, average annualised performance since inception. Correct as of 31-March-2021. Past performance does not indicate current or future performance, and should not be the only thing you consider when selecting a fund. The value of your investments can go down as well as up and you may get back less than your original investment

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