Newspaper Page Text
■ Financial
Focus
Reported by Sonny Doehring
Are socially responsible funds right for you?
Over the past several years, you
might have heard about socially respon
sible investing, sometimes known as
“sustainable investing” or “ethical
investing.”
Probably the most common way to
take part in this type of investing is
through socially responsible mutual
funds — but are these funds suitable
for your overall financial goals?
Before you can answer that question,
you need to become somewhat familiar
with how these types of mutual funds
operate.
Basically, the managers of socially
conscious funds seek to own companies
that, in various ways, may promote
such things as human rights and envi
ronmental and consumer protection.
These managers also typically “screen
out” those companies involved with
the military, tobacco, alcohol and other
industries involved with products or
services that may be controversial.
So you may ask yourself, after these
qualifications are imposed and screens
are applied, can socially responsible
mutual fimds still find the right invest
ments to earn a reasonable rate of
return?
And the answer is yes — the perfor
mance of many of these funds has been
comparable to that of non-screened
funds.
Furthermore, the performance
of socially responsible funds can be
tracked and measured against other
funds with similar objectives.
Socially responsible funds even have
their own index — the Domini Social
400 Index. While this index is not man
aged, and you can’t invest directly in it,
you will find it a useful tool should you
decide to invest in socially responsible
funds.
Yet, despite these factors, there is at
least one potential drawback to invest
ing in socially responsible mutual
fimds: lack of diversification.
The problem isn’t so much that an
individual socially responsible fund may
not be properly diversified, although
that could happen, given the necessity
to screen out entire industries.
The bigger issue is that the universe
of socially responsible funds is much
smaller than that of other funds, and
socially responsible funds, by defini
tion, resemble each other to a certain
extent.
Consequently, you may have a hard
time achieving a diversified portfolio
of socially responsible funds across dif
ferent asset classes — small, mid-size
and large companies, “value” stocks,
international stocks, etc. — that is so
important when investing.
Of course, diversification, by itself,
cannot guarantee a profit or protect
against a loss.
However, the more asset classes you
can diversify into, the better opportu
nity you have to help reduce the effects
of volatility on your portfolio.
This helps explain why socially
responsible portfolios tend to have
more volatile returns and are more
susceptible to sharp downturns during
bear markets than non-socially respon
sible mutual fimds.
Before you invest in a socially con
scious fund, or any mutual fund, for
that matter, be sure to read the pro
spectus carefully, because it describes
the fund’s investment objective, risks,
charges and expenses. In the invest
ment world, knowledge is power.
Ultimately, in evaluating socially
responsible funds, you will have to
decide just how much your sense of
social responsibility will affect your
investment choices.
So take your time, evaluate all the
factors involved, consider the alterna
tives— and make the decisions that are
right for you. “I
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Business Upda
Brunswick-GI Airport
Continued from Page 1
Stambaugh, Jr. said.
On December 5, 2008 the GCAC
sent a letter to Manning Aviation
asking for assurances that two B-
727s parked on the eastern ramp
were not abandoned. "The Commis
sion believes these aircraft were
parked on your apron beginning on
March 1, 2008," the letter stated.
The letter also said that the com
mission would consider the aircraft
abandoned beginning March 1, 2009
and would take legal actions for
removal.
On February 25, 2009 Stambaugh
Aviation responded to the GCAC say
ing they, Stambaugh, were respon
sible for the aircraft and that the
aircraft had been parked on the ramp
since 2008. Furthermore, that Stam
baugh was being compensated "to
park and maintain these aircraft by
their respective owners; and Man
ning is being compensated (by Stam
baugh) for the parking of these air
craft."
The two aircraft referred to in the
correspondence are the black and sil
ver 727 and the Pan Am 727 aircraft.
No parts have been removed from
the black and silver plane; the Pan
Am plane has had the engine nacelle
removed (late 2008) and a portion of
the tail section removed.
The Stambaughs were upset that
the commission sent Manning Avia
tion a letter (August 6, 2009) stating
the GCAC's concern that all five of
the aircraft are "non-airworthy and
nearing the state of abandonment."
The letter also stated that aban
doned aircraft is a potential lease
default. "We are interested in pro
moting business as well as Stam
baugh Aviation who has requested
the aircraft be stored on your ramp,
however our experience has not been
good with this type of aircraft and the
age which they are now approach
ing."
The letter also asked that Man
ning not renew the ramp lease with
Stambaugh which ends January 1,
2010, and that the aircraft be moved
back to Stambaugh's ramp by year
end 2009.
Stambaugh Aviation currently has
two B-727s parked on their ramp
space that have been there, according
to commission records, since Decem
ber 2005.
According to a commission report
on these aircraft, "engines have
been removed, markings removed on
one aircraft, portion of tail section
removed from each aircraft and vari
ous parts missing."
On August 12, 2009, the com
mission sent a letter to Stambaugh
Aviation asking them to remove the
Turn to Page 5
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