Wehaven’tbeeninthissituationbefore,sowho’stoknowwhatmighthappennext?

AtMoneyWeek,wecan’tbesure,butweguessitwillbesomethingbad。

Andtous,thatmeansthatnowisatimefordefensiveinvesting。

Nextweek,wewilllookatexactlyhowbestonecandothis,butfornowI’dliketopointtoonethingthatprobablyisn’tverydefensive:buyingintoethicalfunds。

Thegreenbandwagonhasgatheredmomentumatthemostastonishingspeed(witnesstheknotsourwould-bepoliticalleadersaretyingthemselvesupinintheireffortstoout-composteachother)。

Adecadeagoyoucouldhavecountedthenumberofethicalfundsonyourfingers,nowyoucanchoosefrom90。

Youcangodarkgreenorlightgreen,demandpositiveornegativecriteriaanddemandamoral,orjustanenvironmental,focus(formoreonethicalfunds,see:Howtoinvestwithacleanconscience)。

Withthisriseinchoiceappearstohavecomeperformance:overthreeyearstheethicalsectorhasdonebetterthanthenon-ethical。

Sowhat’stheproblem?

Thefactthatthesectorisbiasedtowardstechnology,newenergy,carbontradingandsmallcaps(mostbluechipswillnevermakethegoodnessgrade),whichsuggeststhegoodperformancecan’tbesustained。

Moneyispouringintoalternativeenergyrightnow,butasthecreditcrunchhits,andtheUSmovesintorecession,isthatsupplyoffundsgoingtokeepflowing?

Idoubtit。

Asforallthefirmsthatarepouringmoneyintogreeninitiativestogetthemselvesontoethicalbuylists,aretheygoingtokeepitupwhenprofitsstarttofall?

Again,Idoubtit。

Isuspectthesefundsareabouttofindthatthelastthreeyearsareinnowayrepresentativeofthefuture。

Personally,I’mtemptedtoignorethelotofthemandimprovetheworldbycommittingregularbutrandomactsofkindnessandneverbuyingaPorscheCayenneinstead。

Butforthoseofyouwhowouldliketoputyourmoneywheretheworld’spoliticiansareputtingtheirmouths,wehavealookatthebetterfundshere。

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