Old Mutual Ethical Fund continues to deliver strong performance

The Old Mutual Ethical Fund continues to deliver strong returns and is ranked in the top quartile of the IMA UK All Companies sector over the one, two, three, four and five year periods to the end of April.

The Old Mutual Ethical Fund has a broad ethical remit and aims to generate long term capital growth by investing in companies which are responding positively to the challenges of environmental sustainability and are making a positive commitment to social issues which are to the long-term benefit of the community. Conversely the fund does not invest in companies which have a significant involvement in armaments, animal testing, pornography, gambling, tobacco or other activities which have an adverse effect on health, the environment or human dignity.

The Old Mutual Ethical Fund is managed using a systematic investment process which forecasts excess return at the individual stock level for each stock within its allowable investment universe. This universe is determined through an external screening process, conducted on OMAM’s behalf by EIRIS, the Ethical Investment Research Service. EIRIS screen all of the constituents of the FTSE All-Share Index in order to exclude those which do not comply with the fund’s ethical mandate.

Anna Perriam, manager of the Old Mutual Ethical Fund, comments: “I’m delighted with the continued strong performance of the Old Mutual Ethical Fund, which is comfortably ahead of both the FTSE All-Share Index and the IMA UK All Companies sector median across a range of time periods. This is particularly pleasing given the reduced universe of stocks in which we are able to invest. Approximately 60% of the FTSE All-Share by market capitalisation is automatically excluded from our universe on ethical grounds, including many of the UK’s largest companies. Furthermore, the screening process means that in certain sectors, such as oil & gas and healthcare, no companies are allowed.”

Matthew Nagele, Managing Director of Fund Distribution at OMAM, comments: “The industry as a whole is seeing significantly increased retail sales of green and ethical funds.

We are seeing increasing interest in the Old Mutual Ethical Fund based on increasing investor awareness of ethical issues and the opportunities for ethical investing, the outstanding performance of the fund and our investment team’s established and proven investment approach. On the back of these factors we see demand in this area continuing to grow.”