Seeking Balance in Sustainable Multi-Asset Investing

A multi-asset approach to sustainable investing brings a broad and more balanced palette to paint with.

Investors turn to sustainable strategies for attractive return potential and opportunities to align with environmental or social themes. For many, it means taking advantage of a broad range of sustainable investment types, from equities and fixed income to non-traditional alternatives, such as real estate and infrastructure.

Balance Can Help Make Sustainable Investing… Sustainable

We think the broader sustainable investment universe provides another potential benefit when effectively and consistently applied: balance.

When unconstrained, a multi-asset approach can leverage a wide mix of sustainable investment building blocks to pursue returns and dial up or down risk levels over time—both of which are important to investors who prefer fewer bumps in their ride.

The Journey Should Map to Global Sustainability Themes

The ideal starting point for prospective sustainable investments are companies whose operations are tied to some or all of the 17 United Nations Sustainable Development Goals (UN SDGs). So far, 193 nations have pledged to hit UN SDG targets, which address economic prosperity, the environment and social inclusion, and it’ll take about US$90 trillion in investments globally to do so by 2030.

These are powerful tailwinds for companies aligned with UN SDGs, and they represent a roadmap of thematic opportunities across stocks, bonds and other investments for years to come. We consider health, climate and empowerment among the most logical and compelling themes, given the breadth of each’s supportive sub-themes (Display).

Three Sustainable Themes That Are Expected to Last