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Portfolio > Portfolio Construction > ESG

New Analytics Platform Screens Investments for ESG Factors

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A key frustration of advisors is determining how “green” stocks, ETFs and funds really are. To solve this dilemma, a new portfolio analytics platform that will enable RIAs to compare and construct customized environmental, social and governance portfolios has been released today by Act Analytics, an investment analytics technology firm based in Toronto.

The new product’s analytical tools will be driven by 200 environmental, social and governance factors and industry data, allowing RIAs to “X-ray” securities, funds and portfolios to determine their ESG levels. This will help RIAs build custom portfolios for their entire client base, according to the company.

“Our new ESG analytics platform for RIAs provides a comprehensive and transparent tool to help advisors deliver values-based investments for their clients, enabling them to differentiate their investment offerings in a rapidly commoditizing industry,” according to Mike Unwin, co-founder and CEO of Act Analytics, and a former financial advisor and portfolio manager whose clients were requesting ESG investments, which spurred his team to build the platform.

Research by Morningstar recently found that flows into ESG funds quadrupled to $20 billion in 2019 from 2018. Further, as Morningstar’s Jon Hale, head of sustainability research, stated in a recent blog post, with BlackRock’s renewed push for ESG investments and Microsoft’s announcement that it would be carbon-negative by 2030, sustainability is continuously becoming a part of a corporate business plan.

According to Unwin, the Act Analytics platform brings in data from Refinitiv and Lipper, using analytical tools to drill down into 20,000 publicly traded equities and 10,000 ETFs and mutual funds. The platform looks at more than 200 ESG factors, such as emissions, diversity, corporate responsibilities as well as controversies.

The platform has recently developed an integration with TD Ameritrade Institutional’s Veo workstation. Said Unwin, “The time for ESG investing is now — clients are demanding it, and as fiduciaries, RIAs are perfectly aligned to delivering this type of values-based investing for their clients.”

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