IFAs see increased demand for ethical investing

One in four (25%) IFAs have seen an increase in client demand for ethical investing over the last few years, according to research from Heartwood Investment Management.

The research, which canvassed the views of UK based IFAs, revealed that more than four in five (81%) would prefer to invest in a globally-diversified ethical portfolio for their clients. Just one in ten prefer investing in a single-strategy ethical fund.

The reason for their preference is attributed to managing client risk. Nearly a third (31%) of intermediaries have struggled to manage their client’s risk when buying single strategy ethical funds in the last six months.

The research also highlighted the need for an integrated screening process when building ethical portfolios. Indeed more than three in five (62%) intermediaries would prefer to invest in a diversified ethical strategy that applies both positive and negative screening criteria.

“Our research has clearly identified a growing demand for ethical investing amongst IFAs and their clients. But digging deeper, there is a clear level of concern by advisers about whether single strategy ethical funds can deliver the appropriate risk / return trade off. We are struck that four in five advisers prefer a globally diversified ethical portfolio for their clients,” said Matt Hollier, head of Investment Product at Heartwood.

“It is also clear that a significant majority of advisers prefer an investment approach that blends a positive ethical overlay with standard negative screening,” Hollier said.

Heartwood launched recently two new ethical multi asset investment strategies to meet changing client preferences.

Alicia Villegas
Alicia Villegas speaks Spanish and Italian and is Iberia Correspondent for InvestmentEurope. She was shortlisted for the Rising Star Award at the British Media Awards 2017 and Writer of the Year at the PPA Independent Publisher Awards 2016. Previously, she worked for almost three years at the seafood business website Undercurrent News as a market reporter. In Spain, she also worked for more than five years for several media outlets.

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