Sustainable Times – Premier Miton Diversified Sustainable Growth Fund

Neil Birrell

Premier Miton’s Chief Investment Officer

In this edition of Sustainable Times, Neil Birrell, Chief Investment Officer and manager of the Diversified fund range, explains why one of the sustainable growth themes in the Premier Miton Diversified Sustainable Growth Fund has been expanded and a new one introduced.

Sustainable thematic investing

For information purposes only. The views and opinions expressed here are those of the author at the time of writing and can change; they may not represent the views of Premier Miton and should not be taken as statements of fact, nor should they be relied upon for making investment decisions.

We believe that taking a thematic approach, particularly in a global growth context, provides several structural and repeatable benefits for a long-term investor. These themes are applied across the corporate bond, equities, property company and, where possible, alternative investment allocations.

The principles for defining a theme have not changed, for each we need to see:

  • A demonstrable and sustainable positive impact from the industry.

 

  • A clear linkage to at least one of the United Nations Sustainable Development Goals (SDG’s).

 

  • A sufficiently large universe of securities in which to invest.

 

We review the themes, with scope to add, remove or redefine themes annually. The world is changing rapidly as the needs and demands of society and the environment develop and we want to be able to reflect those changes and the investment opportunities they produce.

Economic & social mobility

We are updating and expanding the Education theme, which invested in companies that seek to enable greater access to secondary and tertiary education through online learning and education technology.

It is being expanded to become, Economic & social mobility.

Pressures on the cost of living around the world driven by inflation and the associated erosion of real wages, in our view, only increases the importance of those companies looking to address economic and social inequalities.

We believe the online education industry in more developed markets, such as the US and the UK, took important strides forward as companies such as Pearson look to increase the availability of online courses and deepen their relationships with both education providers and students.

Whilst we consider access to education remains core to addressing global poverty, we will now look beyond our previous universe of opportunities. The fairer provision of employment opportunities and vocational training are now also covered in this theme; these aid the reduction of inequalities within society.

An example of what can now also be included within this expanded theme would be; lower cost funeral services and planning, which allows for lower personal and financial stress at a very difficult time in people’s lives. The cost of funerals from providers such as US company Service Corp, has been falling over the last five years, with lower cost options being added to their portfolio of services. This enables greater access to a dignified funeral service.

Digital resilience

This new theme is being added, making it the ninth in total for the fund. It includes companies that can secure digital networks and infrastructure.

Events such as COVID and the war in Ukraine have highlighted both the importance of the digital economy and the threats to a safe and sustainable system, allowing it to operate and grow. Digital resilience encompasses all aspects of enabling safe and secure systems, both at home and in work, including cyber security and accessible digital infrastructure for all. The number of specialist service and hardware providers is increasing to meet this growing need.

Palo Alto Networks is a large US cyber-security company. We have been monitoring the cyber-security sector for some time, with rising geopolitical tensions and an increase in cyber-attacks highlighting the seriousness with which companies, and individuals, must take online security. Upon completion of our initial research, we deemed valuations within the sector to be too high and decided to wait for a more attractive investment entry point, the ensuing selloff in technology stocks provided such an opportunity.

Investing outside the themes

As this is a multi asset fund it is not always possible for all investments to be part of the sustainable themes. Where this is the case, appropriate criteria are considered to ensure the investment is in the spirit of a sustainable investing fund.

These include government bonds where we assess a country’s approach to factors including democracy, civil liberties and corruption. We use independent, recognised measures of these; the Corruption Perceptions Index and the Freedom in the World annual global report on political rights and civil liberties, published by Freedom House and set minimum standards.

We are adding an assessment of a country’s approach to climate consideration to our investment process and will be using the ND-GAIN Country Index. It summarises a country’s vulnerability to climate change and other global challenges, in combination with its readiness to improve resilience. It aims to help governments, businesses and communities better prioritize investments for a more efficient response to the immediate global challenges ahead. The index is produced by the University of Notre Dame.

Markets; 2023 and beyond

The prospects for the global economy and financial markets continue to be uncertain and we remain cautious in our outlook. After three very difficult years, there is room for optimism, however, as peak inflation and interest rates are in sight, we continue to believe there is an alignment between a long term thematic sustainable investment approach and long term financial returns.

How would you rate the information in this article?

Click on a star to rate it.

We are sorry that this post was not useful for you.

Write your comments here:

Tell us how we can improve this post?

Risks

The value of stock market investments will fluctuate, which will cause fund prices to fall as well as rise and investors may not get back the original amount invested.

This fund may experience high volatility due to the composition of the portfolio or the portfolio management techniques used.

Government and corporate bonds generally offer a fixed level of interest to investors, so their value can be affected by changes in interest rates. When central bank interest rates fall, investors may be prepared to pay more for bonds and bond prices tend to rise. If interest rates rise, bonds may be less valuable to investors and their prices can fall.

Reference to any particular stock/investment does not constitute a recommendation to buy or sell the stock/investment.

Funds that follow a sustainable investment approach exclude companies which do not meet their sustainability criteria from the investment universe and therefore can carry a higher risk than funds with a more diversified portfolio

Forecasts are not reliable indicators of future returns.

IMPORTANT INFORMATION:

For Investment Professionals only. No other persons should rely on the information provided.

Whilst every effort has been made to ensure the accuracy of the information provided, we regret that we cannot accept responsibility for any omissions or errors.

A free, English language copy of the Prospectus, Key Investor Information Document and Supplementary Information Document are available on the Premier Miton website, or copies can be requested by calling 0333 456 4560 or emailing [email protected]

Financial promotion issued by Premier Portfolio Managers Limited (registered in England no. 01235867), authorised and regulated by the Financial Conduct Authority, a member of the Premier Miton Investors marketing group and a subsidiary of Premier Miton Group plc (registered in England no. 06306664). Registered office: Eastgate Court, High Street, Guildford, Surrey GU1 3DE.

008734/250123

Stay up to date

Sign up to receive the latest articles straight to your inbox

Main Disclaimer

Disclaimer

This section of the website and the content it contains is for retail clients only and by persons who are resident in the United Kingdom [who are not US persons]. Professional advisers should refer to the Professional Advisers site.

The content of the pages of this website is for your general information only. It, and the products and services described within it, are subject to change without notice. We shall not be liable to you, or any third party, for any amendment, modification, suspension or discontinuance of any product or service described on our website. Neither we, nor any third parties, provide any warranty or guarantee as to the accuracy, timeliness, performance, completeness or appropriateness of the information and materials made available on this website.

You acknowledge that such information may contain inaccuracies or errors and we expressly exclude liability for any such inaccuracies or errors to the fullest extent permitted by law. Your use of any information or materials is entirely at your own risk, for which we shall not be liable.

The information contained on this website does not constitute an offer or solicitation to sell or purchase shares in the funds or portfolios or to provide you with other products or services. Any application or investment must only be made on the basis of the relevant documentation of the investment, such as, for example, terms and conditions. The information on this website does not constitute any investment, tax, legal or other advice. Persons who do not have professional experience in matters relating to investments should always consult with an independent financial adviser before making an investment decision. Any opinion expressed on individual funds, services or products represent the views of the individual at the time of preparation and should not be interpreted as a personal recommendation to buy or sell or otherwise trade all or any of the investments that may be referred to.

Website terms of use: Please ensure you have read and accept the full 'website terms of use' before continuing.

Read the full 'website terms of use' >

Disclaimer

This section of the website and the content it contains is for professional financial advisers only and should not be relied upon, or circulated to, retail clients. Retail clients should refer to the Private Investor's site.

The content of the pages of this website is for your general information and use only. It, and the products and services described within it, are subject to change without notice. We shall not be liable to you, or any third party, for any amendment, modification, suspension or discontinuance of any product or service described on our website. Neither we, nor any third parties, provide any warranty or guarantee as to the accuracy, timeliness, performance, completeness or appropriateness of the information and materials made available on this website.

You acknowledge that such information may contain inaccuracies or errors and we expressly exclude liability for any such inaccuracies or errors to the fullest extent permitted by law. Your use of any information or materials is entirely at your own risk, for which we shall not be liable.

The information contained on this website does not constitute an offer or solicitation to sell shares in the funds or portfolio or to provide you with other products or services. Any application or investment must only be made on the basis of the relevant documentation of the investment, such as, for example, terms and conditions. The information on this website does not constitute any investment, tax, legal or other advice. Persons who do not have professional experience in matters relating to investments should always consult with an independent financial adviser before making an investment decision. Any opinion expressed on individual funds, services or products, represent the views of the individual at the time of preparation and should not be interpreted as a personal recommendation to buy or sell or otherwise trade all or any of the investments that may be referred to.

Website terms of use: Please ensure you have read and accept the full 'website terms of use' before continuing.

Read the full 'website terms of use' >

The content you are trying to access is intended for investment professionals only.

Please use the button below to return to the hompage.

Main Disclaimer

Disclaimer

This section of the website and the content it contains is for retail clients only and by persons who are resident in the United Kingdom [who are not US persons]. Professional advisers should refer to the Professional Advisers site.

The content of the pages of this website is for your general information only. It, and the products and services described within it, are subject to change without notice. We shall not be liable to you, or any third party, for any amendment, modification, suspension or discontinuance of any product or service described on our website. Neither we, nor any third parties, provide any warranty or guarantee as to the accuracy, timeliness, performance, completeness or appropriateness of the information and materials made available on this website.

You acknowledge that such information may contain inaccuracies or errors and we expressly exclude liability for any such inaccuracies or errors to the fullest extent permitted by law. Your use of any information or materials is entirely at your own risk, for which we shall not be liable.

The information contained on this website does not constitute an offer or solicitation to sell or purchase shares in the funds or portfolios or to provide you with other products or services. Any application or investment must only be made on the basis of the relevant documentation of the investment, such as, for example, terms and conditions. The information on this website does not constitute any investment, tax, legal or other advice. Persons who do not have professional experience in matters relating to investments should always consult with an independent financial adviser before making an investment decision. Any opinion expressed on individual funds, services or products represent the views of the individual at the time of preparation and should not be interpreted as a personal recommendation to buy or sell or otherwise trade all or any of the investments that may be referred to.

Website terms of use: Please ensure you have read and accept the full 'website terms of use' before continuing.

Read the full 'website terms of use' >

Disclaimer

This section of the website and the content it contains is for professional financial advisers only and should not be relied upon, or circulated to, retail clients. Retail clients should refer to the Private Investor's site.

The content of the pages of this website is for your general information and use only. It, and the products and services described within it, are subject to change without notice. We shall not be liable to you, or any third party, for any amendment, modification, suspension or discontinuance of any product or service described on our website. Neither we, nor any third parties, provide any warranty or guarantee as to the accuracy, timeliness, performance, completeness or appropriateness of the information and materials made available on this website.

You acknowledge that such information may contain inaccuracies or errors and we expressly exclude liability for any such inaccuracies or errors to the fullest extent permitted by law. Your use of any information or materials is entirely at your own risk, for which we shall not be liable.

The information contained on this website does not constitute an offer or solicitation to sell shares in the funds or portfolio or to provide you with other products or services. Any application or investment must only be made on the basis of the relevant documentation of the investment, such as, for example, terms and conditions. The information on this website does not constitute any investment, tax, legal or other advice. Persons who do not have professional experience in matters relating to investments should always consult with an independent financial adviser before making an investment decision. Any opinion expressed on individual funds, services or products, represent the views of the individual at the time of preparation and should not be interpreted as a personal recommendation to buy or sell or otherwise trade all or any of the investments that may be referred to.

Website terms of use: Please ensure you have read and accept the full 'website terms of use' before continuing.

Read the full 'website terms of use' >