Summer 1986 RAIN Page 19 Guide to Socially. 'Responsible, Investment Funds This brief guide includes a chart of financial information and.a description of investment guidelines for funds that screen their investments based on social as well as financial criteria. Note that the term "socially res.ponsible" is very relative. Each fund applies a very different set of criteria. The New Alternative Fund, South Shore Bank, and the Parnassus·Fund seek out a particular type of positive investment (such as solar energy), which tends to exclude negative investments (such as weapons or nuclear power production, operations in South Africa). Oth!!r funds also seek positive investments, but are more specific on what they exclude. An example of how different these funds can be is that Pax World Fund-is the most thorough of all in excluding military and weapons related products, while Dreyfus Third Century Fund does not specifically screen this area. Calvert Social Investment Fund and Working Assets have the most compre- · hensive.social screens. , Some funds have partial screens, such as Pioneer II. However, its long term financial record is better than the other funds. The Washington Mutual Investors Fund, part of the American Funds Group, has a screen similar to the Pioneer Group. An unusual example is the Colonial Funds, which has a gold fund that does not invest in South Africa~ · Some funds do not have a policy of using a social screen, but are fairly free of negative investments. An example is the Over-the-Counter Securities Fund, which invests in . small emerging companies. Only a small percentage of its investments are negative, but since it has no policy of · excluding certain investments, this could change. This fund does.have a policy of not investing in companies operating in South Africa that have not signed the Sullivan Principles. Mutual funds pool the money of many small investors to buy a pt>rtfolio of stocks and bonds. Advantages include that the fund is managed by a professional money manager, securities purchases can be diversified into a wide range of investments, and they are fairly liquid-you can get your money in seven days. Stock mutual funds are generally recommended as long term investments and are judged on long term performance (see Average Annual Total Return). Keep in mind · th~t some of the funds on this chart are only one to three years old-that is a short time to make a judgement about their trackrecc;>rds. Looking at the results of the last 12 months alone can be a bit misleading, since almost all mutual funds had impressive returns in 1985 and into 1986. Money market funds use short term investments to maintain principle and earn a modest rate of return. Returns fluxuate with interest rates, which have fallen over the past year. The.chart provides the rates of the last 12 months and the current yield. All three funds provide free limited checking. The minimum investment is a bit high for some of these funds and may exclude some people. The sales fee or "load" is a factor. It is a one time fee deducted at the time of an initial investmeni to pay brokers commissions and fund expenses. Some so called "no load" funds do subtract fees in other ways than a front end charge, so you need to look care'fully at . the fund prospectus. Investors need~ match their own social priorities and financial needs with the socially screened funds. As interest in this area grows, we are likely to see new funds established.to offer socially responsible investors more options. - Socially Responsible Funds: Social Screens Calvert Social Investment Fund, 1700 Pennsylvania Avenue, NW, Washington, D.C., 20006; 800/368-2748 Both a mutual fund and money market fund are available. The fund im·ests in companies that deliver safe products and services in ways that sustain our environment; are managed with participation throughout the organization; negotiate fairly with workers, provide a good work environment and opportunities for women and minorities; and foster human goals such as creativity and responsibility. It excludes· companies primarily engaged in nuclear energy, business activities in South Africa and the manufacture of weapons systems. Investment objective: growth and income. Dreyfus Third Century Fund, 666 Old Country· Road, Garden City, NY 11530; 800/645.:6561 . One of a large family of funds, this fund invests in companies that show evidence in the conduct of their business, relative to other companies in the same industry, of contributing to the enhancement of the quality of life in America. A company's record is considered in the areas of protection of the environment, occupational health and safety, consumer protection, and eq~al employment opportunity. Dreyfus recently decided to exclude companies operating in South Africa. There is no screen for the defense industry. lpvestment objective: growth. New Alternatives Fund, 295 Northern Boulevard, Great Neck, NY 11021; 5161466-0808 . Invests in companies that have an interest in solar and alternative energy development. The fund states that alternative energy by its nature is an affirmative investment that tends to exclude atomic weapons, South African investments, and environmental polluters. Investment objective: long-term growth. Parnassus Fund, 1427 Shrader Street, San Francisco, CA 94117; 41~/6~4-6812 . . Started by l.erome Dodson, the founder and former President of the Working Assets Money Fund. The fund takes a "contrarian" approach by buying stocks that are out of favor with the
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