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Green Mutual Funds See Earnings Decline Less than one percent of the $8.95 trillion invested in open-end mutual funds resides in socially responsible funds, those entities that function with religious or philosophical screens, such as strategies that target environmentally friendly companies. Although the percentage may be small, the investment is still significant and investors in this highly specialized sector have seen their holdings decrease in value by some $1.2 billion from the first of the year to August 31 when the latest data was made available. Investors have been reluctant to get behind alternative energy companies and geopolitical events in the Middle East as well as the nuclear testing in North Korea have seen more people stockpiling cash in money market funds. In addition, over the past eighteen months stocks in natural resources have performed extremely well, an increase that was no t seen in so-called "green" funds that do not invest in oil, gas, or mining. A senior research analyst for Lipper, Tom Roseen, speaking to the Associated Press said, "A lot of people might have said, 'You know, we're really missing the boat on oil and gas.' The run-up in natural resources really put "green" funds at a disadvantage." Another factor that comes into play to explain the fall off in "green" investing is the recent trend on Wall Street toward inexpensive value stocks over risky growth stocks. "Green" funds that have done well during the year include the Winslow Green Growth Fund, the Vanguard FTSE Social Index Fund, and the New Alternatives Fund. |
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