This post has been brought to you in partnership with Scotia iTRADE. All thoughts and opinions are my own and do not necessarily reflect the views of Scotia iTRADE.
We’ve heard it all before. Save early. Save often. Keep saving and put some of those savings into long term investments. Diversify your investments. Then stay invested, maybe by tuning out daily market noise and rhetoric. And maybe the most important part, mind your money management fees while you invest. Fees are forever.
It’s all true – good (financial) advice is not hard to find.
Navigating the investing landscape
While investment information is plentiful it’s also never been harder to sort through them to find the information and a strategy that’s right for you, for what you believe in.
- Invest in indexed products?
- Invest in dividend paying stocks?
- What about investing using traditional mutual funds? What about value investing as a strategy
- I’ve heard momentum investing, smart-beta or factor investing is getting more traction?
I can appreciate it’s challenging at times to navigate the investing landscape. This is why I’m a big believer in sharing what I know on this site; ultimately good investing decisions originate with ample information. After all, it’s your money.
I’ve chosen to invest directly in many Canadian and U.S. dividend paying stocks over the years. In addition, I’m interested in investing in companies that are focused on making positive societal and environmental impacts around us. I personally don’t invest in “sin stocks” such as tobacco companies for this reason even if they may have been otherwise appealing. Your investing decisions may vary.
Long before I started investing, smart companies and good management within those companies recognized what’s generally good for society could limit financial risk. Welcome to the world of Sustainable Investing.
How can you decide what companies to invest in?
Tools to sort, filter and analyze companies related to their environmental, social, and corporate governance (ESG) activities have historically, like other sophisticated analytical tools, resided with institutional investors. That is, until now.
Scotia iTRADE has launched Canada’s first sustainable investing tools for direct investors to better inform them about the investing decisions they are making. Access to ESG criteria and scores are now embedded within the online platform’s existing screeners, research reports and company data – for over 1,200 North American stocks.
As a DIY investor, who focuses on buying individual stocks in my portfolio, I’ve always been curious about such factors beyond the typical dividend metrics I screen for. Using Scotia iTRADE’s sustainable investing tools you can see the ESG criteria displayed – it’s easy to filter companies with practices that align with your values.
Making an informed investing decision
Sustainable and responsible investing is, in summary, an approach that considers more than just the long-term competitive financial return to investors. You have probably appreciated by now there are many motivations behind sustainable investing – for companies and prospective investors alike. For retail investors like you and I, investors that embrace sustainable investing may be better equipped to manage their stock selection risk; ESG information can help provide insight into future company challenges but also highlight competitive opportunities that lie ahead.
With many investing choices these days, investors need to decide what their focus and priority is. Considering answering the question: what do you feel strongly about? Is it avoiding some “sin stocks” like I do? Whether your approach is the same or not you can decide with ample information at hand. Inevitably all investors, including broad based fund investors, invest with some compromises.
At the end of the day, research that can be harvested for sustainable investing decisions is just one part of an investor’s toolkit. Scotia iTRADE’s sustainable investing tools are exclusively available to Scotia iTRADE clients and these insights are provided by, Sustainalytics, who provide comprehensive performance ratings based on ESG factors for over 1,200 companies on the Toronto Stock Exchange and Russell® 1000 Index. Some examples include labour relations, clean energy usage, green initiatives and ethical business practices.