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What Are SHORT-TERM INVESTMENTS: Definition, Examples, and Banks




What Are Short-Term Investments?

Short-term investments, also known as marketable securities or temporary investments are those you make for less than three years. You are sacrificing a potentially higher return for the certainty of having the money.

Many short-term investments are sold or converted to cash after as little as 3 to 12 months. Often times when you make a short-term investment, you do so because you need the money at a specific time. For example, if you are saving for a down payment on a house or a wedding, the money should be ready.

How short-term investments work

The objective of any short-term investment, both for corporate investors and individual/institutional investors, is to protect capital while offering a return similar to that of a Treasury bill index fund or other similar benchmarks.

Companies with a strong cash position have a short-term investment account on their balance sheet. As a result, the business can afford to invest excess cash in stocks, bonds, or cash equivalents for higher interest rates than a regular savings account.

There are two basic requirements for a business to qualify for a short-term investment. First, it has to be liquid, like a stock traded on a major stock exchange that is frequently traded or on US Treasuries. Second, management must intend to sell the security in a relatively short period of time, such as 12 months.

Marketable debt securities, also known as “short-term paper” that mature in one year or less, such as US Treasury bills and commercial paper, are also considered short-term investments.

Marketable stocks include investments in common and preferred stocks. Negotiable debt can include corporate bonds, that is, bonds issued by another company. However, they must also have short expiration dates and must be actively traded to be considered liquid.

Examples of short-term investments

Some common short-term investments and strategies used by companies and individual investors are:

  • Payment receipts (CD): These deposits are offered by banks and generally pay a higher interest rate as they lock the cash for a period of time. It is insured by the FDIC up to $ 250,000.
  • Money Market Accounts: The returns on these FDIC-insured accounts exceed the returns on savings accounts, but require minimal investment. Note that money market accounts are different from money market funds that are not insured by the FDIC.
  • Treasury: There are a variety of these bonds issued by the government, such as Notes, bills of exchange, floating-rate notes, and inflation-protected securities (TIPS).
  • Pension fund: These funds offered by professional asset managers/investment companies are better suited for a shorter period of time and offer above-average risk returns. Just keep the fees in mind.
  • Municipal bonds: Issued by local, state, or non-state agencies, these bonds can offer higher yields and tax benefits because they are often exempt from income taxes.
  • Peer-to-peer loans (P2P): Excess money can be brought into play through one of these lending platforms, linking borrowers with lenders.
  • Roth IRA: For individuals, these vehicles offer flexibility and a variety of investment opportunities. Contributions, but not earnings, to Roth IRAs can be withdrawn at any time with no penalties or taxes owed.

Best short-term investments in 2021:

Below are the short-term investment options with high returns you should consider in 2021

Savings accounts

A savings account at a bank or credit union is a good alternative to having cash in a checking account, which generally pays very little interest on your deposit. The bank regularly pays interest on a savings account.

Savers do well with comparison store savings accounts because it’s easy to find the banks with the highest interest rates and set one up.

Liquidity: Savings accounts are very liquid and can add money to the account. However, savings accounts generally only allow up to six free withdrawals or transfers per statement cycle. (The Federal Reserve has allowed banks to waive this requirement as part of its market contingency measures.) Obviously, beware of banks that charge account management or ATM access fees so that you can minimize them.

Risk: Savings accounts are insured with banks with the FDIC and with credit unions with the NCUA, so you won’t lose money. There is no real risk to these short-term accounts, although investors who hold their money for longer periods will have trouble keeping up with inflation.

Short-term corporate bond funds

Corporate bonds are the bonds of large companies that are issued to finance your investments. They are generally considered safe and pay interest on a regular basis, possibly quarterly or twice a year.

Pension funds are collections of these corporate bonds from many different companies, generally in many industries and sizes of companies. This diversification means that an underperforming bond will not detract much from the total return. The pension fund pays interest regularly.

Liquidity: Money market accounts are very liquid, although federal law places some restrictions on withdrawals.

Risk: A short-term corporate bond fund is not insured by the government and therefore may lose money. However, bonds tend to be quite safe, especially if you are buying a widely diversified collection. Additionally, a short-term fund offers the least risk of changing interest rates, so rising or falling interest rates don’t affect the fund’s price too much.

Cash management accounts

A cash management account allows you to put money in a variety of short-term investments, and it behaves very similarly to a general account. You can invest frequently, write checks on the account, transfer money, and do other typical banking activities. Cash management accounts are often offered by Robo-advisors and online brokers. Therefore, the cash management account offers you a lot of flexibility.

Liquidity: Cash management accounts are extremely liquid and money can be withdrawn at any time. In that sense, they may even be better than traditional savings and money market accounts, which limit monthly withdrawals.

Risk: Cash management accounts are often invested in safe, low-yielding money market funds, so there is little risk involved. With some Robo-advisor accounts, these institutions deposit their money in FDIC-protected partner banks. Therefore, you should ensure that you do not exceed the FDIC deposit insurance if you are already doing business with one of the partner banks.

Short-term US Treasury funds

Government bonds are like corporate bonds, except that they are issued by the federal government of the United States and its agencies. Government bond funds buy assets such as treasury bills, treasury bills, treasury notes, and mortgage-backed securities from government-sponsored companies such as Fannie Mae and Freddie Mac. These bonds are considered low risk.

Liquidity: Government bonds are one of the most traded assets on stock exchanges, making government bond funds highly liquid. They can be bought and sold every day the exchange is open.

Risk: While these bonds are not backed by the FDIC, the bonds are the government’s promise to pay you back. These bonds are considered very safe as they are backed by the full faith and solvency of the United States.

Also, a short-term bond fund means that an investor takes low-interest rate risk. Therefore, rising or falling interest rates do not have a major impact on the fund’s bond price.


Payment receipts

You can find certificates of deposit or CDs at your bank, which generally offer a higher rate of return than other banking products, such as savings accounts and money market accounts

CDs are term deposits. So when you open a CD, you agree to keep the money in the account for a certain period of time, ranging from weeks to many years, depending on how long you want. In exchange for the security of having this money in your vault, the bank pays you a higher interest rate.

The bank regularly pays interest on the CD. At the end of the CD’s useful life, the bank returns your principal plus any interest you’ve earned.

Liquidity: CDs are less liquid than other bank investments on this list. Generally, if you accept the terms of the CD, you allow the bank to charge you a penalty for finalizing the CD early. Therefore, you must be especially careful not to tie up your money and then have to access it before the term expires.

Risk: CDs are FDIC insured, so you won’t lose money on them. The risks of a short-term CD are limited, but one of the risks is that you will lose a better price elsewhere while your money is tied up on the CD. If the interest rate is too low, you can also lose purchasing power due to inflation.

Best Short-Term Investments Banks

Below is a list of best short-term investments for your money


When you need to invest your money for only several weeks or months, you don’t need to pour money into investments that are not easy to liquidate, have withdrawal fees, or are too risky in the short term. A course on Financial Intelligence can help you get started on a good note.

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Discretionary Investment Management: Overview, Advantages and Risk




What is discretionary investment management?

Discretionary investment management is a form of investment management in which buying and selling decisions are made by a portfolio manager or investment advisor on behalf of the client. The term “discretion” refers to the fact that investment decisions are made at the discretion of the Portfolio Manager. This means that the client must have the greatest confidence in the skills of the investment manager.

Discretionary investment management can only be offered by individuals with extensive investment industry experience and advanced training. Many investment managers have one or more job titles such as Chartered Financial Analyst (CFA) and Chartered Alternative Investment Analyst, Chartered Alternative Investment Analyst (CAIA), Chartered Market Technician (CMT), or Financial Risk Manager (FRM).

Understand discretionary investment management

In general, there are two types of investment management styles:

  • Non-discretionary investment management
  • Discretionary investment management

Non-discretionary investment managers are distinguished by the fact that they conduct all research and recommendations of the investment process. However, clients reserve the right to make the final investment decision. This is effective because investment managers do not have to risk making the wrong decision and the client remains responsible for the decisions that are made while continuing to receive professional research and advice.

The limitation, however, is that decisions can be made much more slowly and not more efficiently when the final decision is left to the customer. Therefore, discretionary investment management can be more effective in implementing investment strategies in a timely manner, as there is no need to consult the client before making an investment decision.

However, discretionary investment managers do not have complete freedom of choice. Managers must make decisions based on client preferences, which are generally set out in an investment policy statement (IPS). The IPS is a detailed document that describes clients’ investment preferences and restrictions and is highlighted by the client’s risk-return profile. The document will be flexible over time as customer preferences and tolerances can change dynamically over time.

How discretionary investment management works

Discretionary Investment Managers demonstrate their strategies using a systematic approach that facilitates performance reporting and specific investment strategies are used. Investments are not personalized or tailored to a customer.

Rather, investments are made according to customer strategies. In other words, customers are grouped according to their key goals and risk tolerance. Then each group will have the same investment portfolio created from the money pool deposited by clients. The customer’s real account is segregated and the funds invested are weighted with the individuals’ capital investments.

Advantages of discretionary investment management

The benefits of using a discretionary investment management include:

  • Convenience: Customers don’t have to waste time worrying about the return on their investments. You can easily put your capital with a professional who will oversee your investments on your behalf.
  • Excessive Return: When properly incentivized, investment managers seek to outperform clients who are above their benchmark.
  • Access to Expertise: Investment Managers are typically professionals who understand the financial markets and invest more than the average person. In theory, this should result in a better return than a personal investment.
  • Economies of scale: Customers can pool their capital and access economies of scale in the form of lower trading fees and block operations.

Discretionary Investment Management Disadvantages

The risks associated with using a discretionary investment manager include:

  • Fees: Discretionary Investment Managers charge a fee for their services and take a portion of the ultimate return a client receives.
  • Underperformance: Due to the unpredictability of financial markets, there is a strong possibility that the Investment Manager will underperform its benchmark.
  • Confidence in the Manager: Clients must have the greatest confidence in the Investment Manager in order to make the best investment decision. However, many clients may feel anxious if they start losing money and want to withdraw their capital from the discretionary investment manager, which limits the manager’s ability to execute their strategies.

Discretionary investment management vs. Advisory Investment Management, Which service is best?

Discretionary investment

Discretionary investment management means that business decisions for clients are made at the discretion of the portfolio manager within the parameters set by the client at the beginning. This means that a company can make routine changes and realignments to a client’s portfolio without first contacting them. However, if a company wants to make a change outside of the agreed mandate, it must first get the customer’s consent.

Discretionary management is often outsourced to a discretionary fund manager (DFM), but a client can also grant an advisor discretionary permissions.

What is advisory investment management?

Advisory investment management means that the advisor makes recommendations based on the client’s circumstances, goals and risk tolerance. However, you cannot respond to these recommendations until the customer has granted specific permission.

Are there any similarities?

Regardless of the service, the advisor is responsible for ensuring that the investments made are continuously appropriate and correspond to the goals and risk profile of the client.

Within portfolio management there are usually two offerings: bespoke and managed (model) portfolio service. A managed portfolio is a model portfolio developed by a DFM or advisor and typically has different risk profiles and objectives to suit a wide variety of clients. A bespoke service is fully customized and tailored to more specific needs.

What are the main advantages and disadvantages?


  • Advisory management supports customer loyalty and loyalty the customer remains in control as every action must be approved
  • Discretionary management takes advantage of market opportunities immediately. Easily outsourced to benefit from specialized investment knowledge and systems, as well as reducing ongoing fund spending and making a wider choice of investments


Advisory management: Every action must be approved by the customer. This is time-consuming and can result in lost investment opportunities. Intense work for the customer and the consultant

Discretionary management: Less control over the client’s daily investment decisions
Is there a difference in cost?

The costs in the investment industry are very different and each product has to be considered separately. Usually, there is not much of a cost difference between the two management styles, especially when portfolio management is outsourced. Specialized DFMs often benefit from institutional purchasing power and the resulting lower fund costs. transferred to the customer.

Which service is best?

While there are pros and cons for both, it comes down to personal preference. Clients who want to be closely involved in day-to-day investment decisions can opt for an advisory service, otherwise a discretionary service may be more suitable.

The past two years have seen periods of market turmoil when advisors would be better positioned to serve their clients if they had discretionary powers. By the time the advisory process is complete, it may be too late to anticipate or even react to market movements. The consensus is that volatility persists and so this should be taken into account when deciding on advisory management.

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Real Estate Business: A Definitive Guide for Beginners (+ How to start tips)




Starting a real estate business is not for the faint-hearted. Not only are there a lot of risks associated with it, but you also don’t get to make sales regularly like every other business. Nonetheless, those who know how can make a lot of money from it.

As a matter of fact, there are over 86,000 real estate brokerage firms operating in the U.S. (based on the most recent census numbers from the 2012 and 2007 economic censuses). This means that the competition is high and you need to get your game right.

Although its not an easy task, you can still get to the climax with proper information and guidelines. And the best part is we have the right resources to help you succeed in your quest.

So, go through this article and discover the best ways to start your real estate business at no cost.

What is a Real Estate Business?

A real estate business is a business whose focus is centered around buying, selling, management, or investing of real estate properties. Also called real property.

Wikipedia says that real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals, or water.

Real estate is different from personal property, which is not permanently attached to the land, such as vehicles, boats, jewelry, furniture, tools, and the rolling stock of an agricultural farm.

Over the years, due to lack of investment or poor investment, less than five percent of Americans have a well-crafted retirement plan. So, if you don’t wanna be 65 and thinking of the next opening at McDonald’s to apply for, then you can consider starting a real estate business. And yes, it is profitable.

Types of Real Estate Business

There are four types of real estate business. They are;

  • Residential real estate
  • Commercial real estate
  • Land
  • Industrial real estate

1. Residential real estate

This type of real estate involves the construction, renovation, and resale of residents (homes). The most common type of residential real estate is single-family homes. However, there are also duplexes, high-value homes, vacation homes, multi-generational homes, condominiums, town-houses, quadplexes, and triple-deckers.

2. Commercial real estate

Commercial real estate involves properties that are used for commercial purposes. Its category include shopping malls, hotels and offices, medical centers, strip malls, and educational buildings.

Apartment buildings can also come under this category since they are owned to generate income.

3. Land

Land, according to Wikipedia is the surface of the earth that is not permanently covered by water. It includes empty land, farms, and ranches. Under empty land, there is undeveloped land, subdivision, site assembly, development, or reuse.

4. Industrial real estate

This type of real estate property is used for industrial purposes. Categories under this include manufacturing buildings and warehouses. Other categories include buildings that are used for research, storage, and distribution of goods.

LEARN ABOUT BUSINESS CYCLE: Definition, Internal, and External Causes

Is Real Estate Business Profitable?

This has got to be the question of the century. Yes! A real estate business is absolutely profitable. In fact the whole point of business is to make profit. And real estate business is one of the most profitable businesses out there although it comes with its own quantity of risk.

One of the ways to constantly increase your profit in real estate business is by appreciation. Appreciation is the increase in value of an asset over time. Assets here can be an undeveloped land, house, or commercial properties. And an increase in value is usually caused by an increase in demand with a decrease in supply.

So, when your assets appreciate over time, you can decide to sell them and make a profit, or rent it out and receive annual payments for your property.

Whichever strategy you decide to employ, the end result still leaves you with enough profit from the business.

Having answered your most important question about the profitability of a real estate business, let’s go over five major things you need to do before you start a real estate business.

Before You Start a Real Estate Business

Before you start a real estate business, there are certain things you must do. Below is a list of the most important things to do in real estate.

  • Get a real estate mentor
  • Obtain your real estate license
  • Pay tax
  • Find a brokerage
  • Know who your target market is
  • Build your personal brand.
  • Conduct a good market research

Do all this and you are one step closer to starting a real estate business.

How to Start a Real Estate Business With no Money

If you really want to start a real estate business, then you must know that its not an easy task. A real estate business has a lot of risks associated with it and your success depends on how deep your market research is as well as your business strategies.

So here are proven ways to start a real estate business and be successful in it.

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1. Develop your idea

Real Estate is a really large field. So, before you want to venture into it, you will need to develop your business idea. Consider your strengths, weaknesses, and areas of interest.

Additionally, think about where you want to set up your real estate business. Knowing the area you want to establish your business in will help you give better descriptions and referrals to those you’ll help to buy properties.

Study your competitors. Discover how they’ve setup their business and in what location. Find out why they chose that location and how they are doing in the industry. In studying them, you’ll pick up few things you can employ to make your real estate business a success.

Next, find a niche for your business. In my opening statement, I told you that real estate business is a really large business. So you would want to narrow your intentions to something you have the time and funds for.

Maybe you want to focus on rental property management, buying and selling condos, short sales, or even listing agent. The competition is really high. So, stand out using a single specialty.

2. Write a Business Plan

Now that you know just what you want your real estate business to be like, it’s time to craft a workable business plan.

A business plan is a documents that outlines the operational and financial goals of your business. It’s like a blueprint that guides you in the right direction. It constantly asks the questions why and how? so that you can come up with realistic steps on how to achieve your business goal.

Your business plan doesn’t have to be very long. The idea is that as you sit down to either craft or customize a business plan, you already have ideas on how to get your business running.

The best part is there are some resources that can help give you a business plan with all the information you need concerning your business.

Our team of business management experts has come up with cutting-edge business plans written specifically for your kind of business. Click on the button to easily access and get a workable business plan with no stress. We love to see your business succeed, so we make every process easy.

3. Develop a Marketing Plan

For your real estate business to be successful, it also depends on your marketing strategy. How do you intend to tell the world that you run a real estate business and you want them to patronize you? A very big question for thought.

Answers to this question will help you position your business in the limelight and force you to brand your business well. This means that you’d have to come up with a business name, logo, business card, website and even social media handle.

Having all this will help you brand your business and get you ready for marketing.

Some common marketing campaigns that convert easily include:

  • Direct Mail: A lot of real estate business owners still use handwritten letters, postcards, and mail letters to reach out to their customers. And guess what, they are consistent.
  • Social Media Ads: Whether you like it or not, social media is a powerful tool that can be used to advertise your business. Post on Instagram, Facebook, Twitter, and LinkedIn. With time you can use paid ads to generate more customers.
  • Email Marketing: Use several emailing software to send out emails to both buyer and seller.
  • Networking: The main marketing strategy for the real estate business is networking. In most cases, it’s about who you know. So, start by attending conferences that expose you to meet other real estate business owners and build relationships.

4. Set up a CRM

A CRM is a Customer Relationship Management System helps your organize your contacts and come up with actionable insights on how to interact with your clients.

This is incredibly useful in real estate business since it thrives on relationships. So you have lots of contacts of multiple agents and homeowners whom you need to convince to patronize your business.

READ THIS POST ON CUSTOMER RELATIONSHIP MANAGEMENT (CRM): Definition, Tools, and Importance to get a better understanding.

5. Organize your Finances

It’s very possible to start a real estate business without money. But you’d want to organize your finances when you require investment. There’s a high probability of investors requesting your financial history before putting their money into your business.

So, request information from your bank on your financial information. Check your credit card report and find out if there are any errors before your investor asks you of it. Doing this half way prevents you from getting a rejection when you need investment.

6. Decide your business legal structure

There are different types of legal structures that real estate businesses can take up. For a beginner, choosing the right legal structure for your business can be overwhelming.

Most real estate agents operate as self-employed business owners affiliated with a licensed real estate brokerage. Generally, they select one of the four different types of business structure; Sole proprietorship, partnership, limited liability company (LLC), or a corporation.

  • Sole Proprietorship: This means that you are responsible for your business profits and debts. It is the most basic business structure.
  • Corporation: This is entirely different from the owners. corporations can own properties and are held accountable to pay taxes.
  • Partnership: A partnership is a shared responsibility between two or more people who are liable for a business
  • Limited Liability Company(LLC): This structure allows owners to limit personal liability. However, they still get to pay taxes and enjoy other benefits.

So, when choosing, consider your future goals for your business. Ensure you choose a structure that can accommodate the growth and expansion of your real estate business.

WONDERING WHAT A B2B REALLY IS? READ THIS Business-to-Business (B2B): How Does It work?

7. Set up a business accounting and bookkeeping system

In order to manage your finances properly, you’d need to set up a business account and bookkeeping system. Through this, you can understand your business’s cash flow for the sake of tax filing.

According to Crowdspring, Business accounting is how your business records, organizes, interprets, and presents its financial information. Accountants analyze the financial condition of a business to help the business owner make better decisions.

Bookkeeping is the recording, organization, storage, and retrieval of financial information related to your business.

Accounting and bookkeeping do overlap. The main difference between the two is that bookkeeping is how you record and categorize financial information, whereas accounting puts the information to use through analysis, strategy, and tax planning.

8. Get Insurance

The best way to protect your business is to get an insurance. As a provider of real estate services, you would want to get a business insurance that covers property damage, theft, lawsuits, and other case scenarios.

This is very important because real estate business involves transactions of large amounts of money. So, you want to be sure you are protected at all cost.

9. Get a Website

Nobody has the time to walk through the streets of New York to check out empty apartments. 60% of all the searches are done online.

Irrespective of your local marketing campaigns, you still need to get an online presence. So, get a domain name same as your business name, and host your website. It may be expensive, but it sure will bring clients over time.

Also, make sure to employ the best SEO practices to rank on search engines like Google. Once this is done, you can start uploading pictures/ videos of the properties that are up for sale on your website and social media handles.

Remember, the aim is to gain as much online presence as possible.

THE QUESTION OF THE MILLENNIUM WHAT Is BUSINESS: Definition, Concepts, and Characteristics?

10. Start running your business

Congratulations! You are now qualified to start running your real estate business. There’s no need to have all the properties in New York registered under your business name. You just need the most important of things.

Make sure to give your real estate business all the time it needs for it to grow.

However, if you want to deflect to other areas, there are some real estate business ideas you can try. We’ll go over them shortly.

Real Estate Business Ideas

If you’ll like to venture into other businesses in the real estate industry, here are 10 potential business ideas you can try.

  • Become a real estate agent
  • Become a real estate broker or investor
  • Start a landscaping business
  • Start a moving company
  • Become a property manager
  • Become a landlord
  • Start a real estate marketing agency
  • Start a property flipping business
  • Become a real estate developer
  • Become a real estate photographer.


With this article, you have a step-by-step guide on everything you need to start a successful real estate business.

Let me know if there’s anything I missed in the comment box below.

Good luck!

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ETHICAL INVESTING: Definition, Types, Pros, and Cons




What is ethical investing?

Ethical investing is an investment strategy in which the investor’s ethical values ​​(moral, religious, social) are the main objective along with good returns. With the rise of suspicious and illegal investment deals, many investors insist that companies make socially responsible investments. It would mean treating your employees with respect, creating healthy products and services, and staying away from unethical business practices.

Who will invest ethically?

Ethical investing is for investors who want to invest their money in charities. For example, if an investor thinks tobacco is bad, he would avoid tobacco-producing companies or invest in the tobacco-producing companies themselves.

Types of ethical investing

Socially responsible investment funds (SRI Funds)

SRI funds avoid investing in controversial areas such as gambling, firearms, tobacco, alcohol, and oil. Here, greater importance is attached to the moral value of the investor over financial returns.

Environment, Social Issues and Governance Fund (ESG Fund)

Unlike SRI funds, ESG funds consider in their decision making how environmental, social and governance risks and opportunities can have a material impact on a company’s performance. You can invest sustainably and achieve the same returns as with a standardized approach.

Impact funds

Impact funds also value the fund’s performance. Therefore, they aggressively try to bring about ethical changes with products and services. Impact funds are suitable for investors who are socially responsible but also want good returns.

Faith-based funds

Faith-based funds only invest in stocks that follow religious values ​​and strictly exclude investments that do not fit into this category.

Ethical investing companies

  1. OpenInvest

Minimum investment amount: $ 100

Socially responsible mission OpenInvest is a non-profit organization that has set itself the goal of making financial services more transparent and making socially responsible investing accessible to all.

When you invest with OpenInvest, you gain access to a comprehensive and fully diversified portfolio that you can then adjust to suit your values. This investment company supports individual and joint accounts, as well as traditional IRAs, ROTH, and SEPs, not to mention tax optimization at the individual share level, for greater tax savings.

How does it work? With this platform, you open a brokerage account, fund the account, and let OpenInvest do the rest. They can explain what is most important to you (i.e. climate change, social equality) so that your investments are directly aligned.

OpenInvest will maximize your impact measured through its online dashboard and you can join movements, participate and use the power of investors to grow your wealth directly with the market. This method also helps reduce unnecessary fees and taxes.

  1. EarthFolio

Minimum investment amount: $ 25,000, 0.5% annual administration fee

Socially Responsible Mission EarthFolio is a hassle-free automated investment service based on the idea that “Investing is more than a transaction; It is a personal commitment to the future. “EarthFolio invests only in funds and ETFs with strong ESG or environmental, social and governance practices. This allows you to get out of the world a little better through smart, affordable and time-efficient investments.

How does it work? Answer 10 questions about your risk tolerance and goals. Then a folder is recommended. It’s that simple that you then have a fully diversified portfolio that is automatically realigned and optimized for your specific goals.

Earthfolio allows you to open an individual or joint account, a trust account, an IRA or Roth rollover, a 401 (k) or 403 (b) rollover, or a SEP.

  1. Ellevest

Minimum investment amount: No minimum balance

Socially responsible mission Ellevest was developed by women for women and offers the only investment algorithm that takes into account the unique realities of women’s lives, including salary differences and longer life expectancies. While Ellevest values ​​fair investment for women, the organization works with all adult American citizens to help them achieve their financial goals through smart investment.

How does it work? Ellevest builds an investment portfolio with a diverse mix of stocks, bonds, and alternative funds to reduce the overall risk in your portfolio. It also recommends how much you should save and help manage a 401 (k) or roll over a traditional IRA, Roth, or SEP. Impact Portfolio enables you to invest in women in leadership, sustainable practices, and community development.

  1. SVX

Minimum investment amount: Varies by occasion

SVX, based at Socially Responsible Mission Canada, provides critical support to shortlisted companies and funds by connecting opportunities with investors who may also seek financial returns. Offers a curated selection of campaigns in the cleantech, social inclusion, health and wellness industries and more. All products on the platform are Canadian securities for the private market.

How does it work? Investors can search for active opportunities through the platform. Once SVX is interested in an issuer and has completed the accreditation process, it will review your investment to make sure it meets your objectives. It will keep your money safe and secure and once the campaign is over, you will receive documentation of your investment if it is successful. You can use the platform to manage your investments, transact, and view the issuer’s financial history and traction.

  1. Miraculous capital

Minimum investment amount: Investments are not currently accepted

Socially responsible mission Founded in 2013, this award-winning investment platform helps people invest in solar projects in the US.

How does it work? Wunder has a national network of large solar partners and actively manages the acquisition of commercial solar opportunities, from underwriting to contracting and construction of each project. From there, the investment platform manages ongoing relationships with solar customers and sends profits to investors. The trusted team of Department of Energy researchers and industry leaders determine which projects to pursue so your investment is diverse and well-regarded.

Advantages and Disadvantages of ethical investment

As with any decision we make, there are pros and cons to consider. Ethical investing may not be the right option for everyone, but it can be a more satisfying strategy for those who want their portfolios to better reflect their social and moral beliefs.


  • Comfort Factor: As long as the companies you invest in to share your values, you feel like you’re helping change the world for the better. When companies perform well, you have the added advantage of benefiting financially from their values.
  • Driving change: Since socially responsible companies and projects are supported by investors, other companies will try to improve their ethical behavior to raise funds. This can only be good for the environment and other important social causes.
  • Future Profit Potential: Socially responsible companies are likely to make better profits as consumer behavior shifts toward more ethical shopping. According to Nielsen statistics, almost three-quarters of millennials would pay a premium for environmental goods and services.
  • Social management can lead to better profits through a more engaged workforce: The ethics and sense of social responsibility that make us feel good about investing in SRI companies can mean a more engaged workforce. This, in turn, can lead to higher employee performance, which translates to higher profits for the company.


  • The Definition of Ethical: You need to decide what you think is ethical or responsible and then invest in companies that meet these guidelines. However, it can be difficult to find an exact match. For example, you may not want to be exposed at all to an SRI fund that includes companies that are involved in tobacco manufacturing, but the fund may have a 10% tolerance when it comes to such activities.
  • Time and Research: Ethical investing is not a passive strategy and you should spend time researching potential investments to make sure they match your values. When every investment in your portfolio has to meet certain criteria, it can get quite complex.
  • Higher fees: Due to additional research and filters associated with SRI, fees can often be higher. Higher fees can affect the performance of your portfolio and therefore underperform more traditional investments
  • Often not an optimal strategy: Investing ethically is unlikely to yield optimal returns. Therefore, the investor can sacrifice financial gain for an ethical approach.


Investors choose ethical investments when they want to make a difference in society. Your main objective when investing is to comply with your moral, social and religious values, while the returns are secondary.

While ethical investing is good, it is an expensive strategy, requiring extensive research to find an investment that meets the investor’s primary objective. The boycott of companies will not affect them either, as a price cut will not attract unethical investors to buy the shares at a lower price.

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