One of the main concerns for investors is if they’re sacrificing profit for sustainability.
The answer is no. The performance of sustainable investment funds is similar conventional funds.
🌱 Sustainable investing is a way of future-investing and in a number of reports, sustainable funds also show better historical performance.
Moreover, we strongly believe that sustainable companies are well-positioned for long-term success due to lower risks, increasing customer demand, and innovative solutions.
So, what is the gain you could expect?
First of all, let's make it clear that indicated gain is not guaranteed and past performance is not a guarantee of future performance.
When you open a Grünfin portfolio, you'll see a gain target (Indicative Investment Gain*).
The target is calculated based on the assumption that bonds grow at 2% and stocks grow at 8% per year on average.
How did we get these numbers?
We looked at both historical and current market contexts and then combined history with projections from prestigious asset managers like J.P. Morgan.
🌱 For example, looking at S&P500 as the benchmark, we can see that the average annual return from 1957 through 2021 is roughly 8%. Regarding bonds, interest rates were negative or close to zero for over a decade, eg as of February 2022, the 10-year US Treasury bond yield was 1.9% and the German Government bond was 0.2%.
In conclusion, we decided to be conservative and project 8% for stocks and 2% for bonds.
Blog: Is sustainable investing profitable?
* Indicated gain is not guaranteed. Past performance is not a guarantee of future performance.