Paid post by Legal & General Investment Management

Index exclusions – but where does the money go?

Many customers believe that an ESG-integrated index fund shouldn’t hold sectors such as oil and gas under any circumstances. But when this is applied to a global index the allocation is redistributed, mainly to the already hefty technology and finance sectors. What was once a broad market index has suddenly become much more concentrated.

On our podcast, we discuss the unintended consequences of whole sector exclusions and dive into the ways investors can keep their ESG impact high and their tracking error low.

 

 

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This is a Legal & General Paid Post. The news and editorial staff of the Financial Times had no role in its preparation.