UBC Investment Management Trust Inc. Commits $110M towards a More Sustainable Global Economy - Canada NewsWire

Investment

UBC Investment Management Trust Inc. Commits $110M towards a More Sustainable Global Economy – Canada NewsWire

Published

3 years ago

March 10, 2021

VANCOUVER, BC, March 9, 2021 /CNW/ – UBC Investment Management Trust Inc. (“UBC IMANT”) is pleased to report it has committed $110 million to be managed by Impax Asset Management (“Impax”), a specialist asset manager which invests in opportunities arising from the transition to a more sustainable global economy.

The mandate uses Impax’s Global Opportunities Strategy, a global equity strategy that invests in companies possessing sustainable competitive advantages in order to achieve long-term capital growth, and that are set to benefit from the transition to a more sustainable economy. Environmental, social and governance (ESG) considerations are embedded within Impax’s investment process and failure of a company to reach the required ESG score will result in it being excluded from consideration.

The fund allotment represents approximately 20% of the global equity portfolios managed by UBC IMANT, or approximately 3% of the total long-term client investment portfolios. This transition of funds is part of UBC IMANT’s Responsible Investing Strategy and commitment to a low carbon, sustainable future.

UBC IMANT’s approach to responsible investing considers sustainability through incorporation of ESG into the investment process, active ownership and engagement by its fund managers. UBC IMANT selected Impax as part of a collaboration with another peer institution to create a sustainability-focused investment vehicle that would be cost effective for clients’ capital.

“Our partnership with Impax will improve risk and return characteristics while advancing our Responsible Investment commitments,” said Dawn Jia, President and CEO of UBC IMANT.

Kirsteen Morrison, Senior Portfolio Manager at Impax Asset Management who co-manages the strategy with David Winborne said, “As the transition to a more sustainable economy accelerates this creates opportunities for well-positioned companies. We believe that this transition provides a helpful backdrop to construct high conviction, low turnover global equity portfolios that are well positioned to achieve long-term capital growth.”

Reinforcing UBC’s commitment to address the global climate emergency, UBC IMANT expects its investment managers to consider ESG factors in all of their decision–making — and is evaluating and holding fund managers accountable to this performance.

Responsible Investing progress planned for 2021 includes transferring additional funds to lower emission and fossil fuel free funds, establishing an active ownership policy, and incorporating climate risk analysis into portfolio analytics and asset mix study.

For more information about UBC IMANT’s Responsible Investing strategy, visit https://www.ubcimant.ca/investments/responsible-investing/.

About UBC IMANT
UBC IMANT is responsible for the investment of the University of British Columbia’s Endowment Fund, Staff Pension Plan, Working Capital and other investment portfolios. UBC IMANT’s team of investment professionals is complemented by an independent Board of Directors.

About Impax
Founded in 1998, Impax is a specialist asset manager, with approximately £27.7bn / US$38.6bn as of February 28, 2021 in both listed and private markets strategies, investing in the opportunities arising from the transition to a more sustainable global economy.

Impax believes that capital markets will be shaped profoundly by global sustainability challenges, including climate change, pollution and essential investments in human capital, infrastructure and resource efficiency. These trends will drive growth for well-positioned companies and create risks for those unable or unwilling to adapt.

The company seeks to invest in higher quality companies with strong business models that demonstrate sound management of risk. Impax offers a well-rounded suite of investment solutions spanning multiple asset classes seeking superior risk-adjusted returns over the medium to long term.

Impax has 180 staff across six offices in the United Kingdom, the United States, Ireland and Hong Kong, making it one of the investment management sector’s largest investment teams dedicated to sustainable development.

www.impaxam.com

SOURCE UBC Investment Management Trust Inc.

For further information: Media contact: [email protected]

Investment

Investment Opportunities With Hot Inflation, Higher-for-Longer Interest Rates – Bloomberg

Published

34 mins ago

April 19, 2024

Like a bad houseguest, hotter-than-expected inflation continues to linger in the US.

Traders had hoped by now the Federal Reserve would be free to start cutting interest rates — boosting rate-sensitive stocks and unlocking a largely frozen real estate market. Instead, stubborn price growth has some on Wall Street rethinking whether the central bank will lower rates at all this year.

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Want to Outperform 88% of Professional Fund Managers? Buy This 1 Investment and Hold It Forever. – The Motley Fool

Published

9 hours ago

April 19, 2024

You don’t have to be a stock market genius to outperform most pros.

You might not think it’s possible to outperform the average Wall Street professional with just a single investment. Fund managers are highly educated and steeped in market data. They get paid a lot of money to make smart investments.

But the truth is, most of them may not be worth the money. With the right steps, individual investors can outperform the majority of active large-cap mutual fund managers over the long run. You don’t need a doctorate or MBA, and you certainly don’t need to follow the everyday goings-on in the stock market. You just need to buy a single investment and hold it forever.

That’s because 88% of active large-cap fund managers have underperformed the S&P 500 index over the last 15 years thru Dec. 31, 2023, according to S&P Global’s most recent SPIVA (S&P Indices Versus Active) scorecard. So if you buy a simple S&P 500 index fund like the Vanguard S&P 500 ETF (VOO -0.23%), chances are that your investment will outperform the average active mutual fund in the long run.

Image source: Getty Images.

Why is it so hard for fund managers to outperform the S&P 500?

It’s a good bet that the average fund manager is hardworking and well-trained. But there are at least two big factors working against active fund managers.

The first is that institutional investors make up roughly 80% of all trading in the U.S. stock market — far higher than it was years ago when retail investors dominated the market. That means a professional investor is mostly trading shares with another manager who is also very knowledgeable, making it much harder to gain an edge and outperform the benchmark index.

The more basic problem, though, is that fund managers don’t just need to outperform their benchmark index. They need to beat the index by a wide enough margin to justify the fees they charge. And that reduces the odds that any given large-cap fund manager will be able to outperform an S&P 500 index fund by a significant amount.

The SPIVA scorecard found that just 40% of large-cap fund managers outperformed the S&P 500 in 2023 once you factor in fees. So if the odds of outperforming fall to 40-60 for a single year, you can see how the odds of beating the index consistently over the long run could go way down.

What Warren Buffett recommends over any other single investment

Warren Buffett is one of the smartest investors around, and he can’t think of a single better investment than an S&P 500 index fund. He recommends it even above his own company, Berkshire Hathaway.

In his 2016 letter to shareholders, Buffett shared a rough calculation that the search for superior investment advice had cost investors, in aggregate, $100 billion over the previous decade relative to investing in a simple index fund.

Even Berkshire Hathaway holds two small positions in S&P 500 index funds. You’ll find shares of the Vanguard S&P 500 ETF and the SPDR S&P 500 ETF Trust (NYSEMKT: SPY) in Berkshire’s quarterly disclosures. Both are great options for index investors, offering low expense ratios and low tracking errors (a measure of how closely an ETF price follows the underlying index). There are plenty of other solid index funds you could buy, but either of the above is an excellent option as a starting point.

Adam Levy has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.

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Index Funds or Stocks: Which is the Better Investment? – The Motley Fool Canada

Published

13 hours ago

April 18, 2024

Canadian investors might come across a lot of arguments out there for or against index funds and stocks. When it comes to investing, some might believe clicking once and getting an entire index is the way to go. Others might believe that stocks provide far more growth.

So let’s settle it once and for all. Which is the better investment: index funds or stocks?

Case for Index funds

Index funds can be considered a great investment for a number of reasons. These funds typically track a broad market index, such as the S&P 500. By investing in them you gain exposure to a diverse range of assets within that index, and that helps to spread out your risk.

These funds also tend to have lower expense ratios compared to an actively managed fund. They merely passively track an index rather than a team of analysts constantly changing the fund’s mix of investments. This means lower expenses, and lower fees for investors.

Funds also tend to have more consistent returns compared to individual stocks, which can see significant fluctuations in value. You therefore may enjoy an overall market trending upwards over the long term. This long-term focus can then benefit investors from the power of compounding returns, growing wealth significantly over time.

Case for stocks

That doesn’t mean that stocks can’t be a great investment as well. Stocks have historically provided higher returns compared to other asset classes over the long run. When you invest in stocks, you’re buying ownership of stakes in a company. This ownership then entitles you to a share of the company’s profits through returns or dividends.

Investing in a diverse range of stocks can then help spread out risk. Whereas an index fund is making the choice for you, Canadian investors can choose the stocks they invest in, creating the perfect diversified portfolio for them.

What’s more, stocks are quite liquid. This means you can buy and sell them easily on the stock market, providing you with cash whenever you need it. What’s more, this can be helpful during periods of volatility in the economy, providing a hedge against inflation and the ability to sell to make up income.

In some jurisdictions as well, even if you lose out on stocks you can apply capital losses, reducing overall tax liability in the process. And while it can be challenging, capital gains can also allow you to even beat the market!

So which is best?

I’m sure some people won’t like this answer, but investing in both is definitely the best route to take. If you’re set in your ways, that can mean you’re losing out on the potential returns which you could achieve by investing in both of these investment strategies.

A great option that would provide diversification is to invest in strong Canadian companies, while also investing in diversified, global index funds. For instance, consider the Vanguard FTSE Global All Cap Ex Canada Index ETF Unit (TSX:VXC), which provides investors with a mix of global equities, all with different market caps. This provides you with a diversified range of investments that over time have seen immense growth.

This index does not invest in Canada, so you can then couple that with Canadian investments. Think of the most boring areas of the market, and these can provide the safest investments! For instance, we always need utilities. So investing in a company such as Hydro One (TSX:H) can provide long-term growth. What’s more, it’s a younger stock compared to its utility peers, providing a longer runway for growth. And with a 3.15% dividend yield, you can gain extra passive income as well.

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