Social impact investing is a major instrument for advisors with three to nine years tenure, found a new study from Incapital, an underwriter and distributor of securities.
However, most believe there is a dearth of ESG fixed income products available. In fact, 58% of those with three to nine years of tenure believed there were too many equity ESG products and not enough fixed income options. In contrast, 34% of advisors with more than 10 years of tenure agreed.
Of all advisors surveyed, 44% use actively managed equity mutual funds to achieve social impact goals, 35% use individual stocks, and 31% use equity ETFs. Despite the lopsidedness of equity ESG products, 30% stated they used fixed income actively managed mutual funds, 29% used bonds and 22% used ETFs to achieve social impact goals.
Indeed, almost all (99%) of the younger generation of advisors surveyed use individual bonds to discuss social impact goals with clients, which is almost 25% more than advisors with more than 10 years of tenure, according to the survey findings.