Practical Applications of Relative Importance of Sustainability Measures and Costs in Mutual Fund Selection

Abstract

In Relative Importance of Sustainability Measures and Costs in Mutual Fund Selection, from the Summer 2020 issue of The Journal of Wealth Management, authors Edward Chang (of Missouri State University), Thomas Krueger (of Texas A&M - Kingsville), and Doug Witte (of Missouri State University) examine the relationship between sustainability and mutual fund performance (historical and anticipated) to see how and to what extent socially responsible investing affects fund performance.

The authors discuss the type of information considered by a socially responsible investor when picking mutual funds–that is, picking funds that align with social goals and that have the best opportunity to do well financially. The authors find that there is little difference in performance between funds with high and low Morningstar sustainability ratings.