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New social investment funds unveiled
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Manulife has introduced a socially responsible pension option also available as a segregated fund and Sentry has unveiled a new fund to attract growing interest in alternative energy. On Feb. 1, Manulife Financial introduced the Manulife Canadian Balanced Ethics Fund, offered as a socially responsible segregated fund through insured portfolios and a social investment option for defined contribution pension plans. The fund is managed by McLean Budden Ltd. The fund is screened to eliminate investment in companies involved in industries such as tobacco and gambling. Additional research is provided by Michael Jantzi Research Associates Inc. Segregated funds are mutual funds guaranteed by insurance companies. The funds are segregated – or kept separate from the assets of the insurance company. Unlike most mutual funds, however, segregated funds typically guarantee to refund a portion of the money an investor has put into the fund, provided he or she retains the fund for a set period. In its pension option, it is believed this is one of the first social investment choices available to members of defined contribution pension plans. In the Canadian Social Investment Review 2000, the SIO identified the lack of social investment options among defined benefit pension plans as a weakness in the Canadian social investment market. In addition, Sentry Select Mutual Funds has unveiled a mutual fund that invests in alternative energy companies. Launched in November, the fund is called the Sentry Select Alternative Energy Fund 2001. The fund invests primarily in US companies and is therefore considered foreign property if held in an RRSP account. The fund is not a “screened” fund normally considered as a socially responsible fund. Instead, the fund is a “sector” fund investing in companies operating in the area of research, development, production and distribution of products and services relating to alternative energy sources. The fund defines alternative energy as energy provided from sources other than fossil fuels (ie. coal, oil and natural gas). Sources of alternative energy include fuel cells, solar power, wind power, hydroelectric power and co-generation. Investment in the fund is open until March 29, 2002. It is expected that the fund will wind up in March 2007, as companies in the alternative energy sector mature and show less value potential. As of Jan. 31, 2001, the top 10 holdings in the fund were Ballard Power, Allegheny Energy, Power-One Inc. , Capstone Turbine, Power Plug Inc., United Technologies, Enron Corp., Fuelcell Energy Inc., American Water works and Advanced Energy Industries. For information on the Manulife fund, visit www.manulife.com. For information on the Sentry fund, visit www.sentryselect.com.
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