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New Alternatives




New Alternatives Fund is thefirstenvironmental mutual fund. They began operations in September 1982. This is the first mutual fund with a significant concentration in alternative energy.

Their environmentally oriented investments are positive forms of social investment. They use five socially conscious federally insured banks and credit unions for holding cash like, the federally insured South Shore Bank, which focuses on building homes for the less affluent. The larger part of the Fund's cash is held in federal T-bills.

The Fund periodically faces the dilemma of considering investment in a company that produces a promising environmental product, but whose other characteristics are not acceptable to their socially responsible standards. There are diverse degrees and subjective judgments concerning this theme. They tend towards avoiding companies with negative behavior at the expense of missing out on a promising product.

New Alternatives Fund seeks long-term growth. The fund invests primarily in common stocks of companies, concentrating in the solar-power and alternative-energy industries. These include companies that are involved in areas such as passive and active architectural-type heating and cooling, cogeneration, electrical generation, and biomass. Firms spotlight on petroleum and atomic-based energy sources and related processes are not considered for purchase.

Government policy and community views change. Concerns and concepts change. They try to change with them. New technologies appear. They try to identify them. There is no assurance that they will have the wisdom to do so. Because of market conditions and the need to make choices, they may not be able to invest in all interesting technologies all the time.

Investments in alternative energy and companies with environmental products are subject to political priorities and changing government regulation. For example, should the government reduce environmental regulation or its enforcement, then companies that produce products designed to provide a clean environment, in which we invest, are less likely to prosper. Potential advantages of alternative energy may be slow in growth and identification.

The Fund may invest up to 35 percent of its assets in securities of foreign companies. Currently it appears to the fund managers that European and other countries are more concerned with environmental programs. Nevertheless, foreign investment has risks arising from currency fluctuation, tax and political changes.

New Alternatives seeks to be socially responsible. They select companies that produce something that benefits their environment, such as recycling, clean air and water, substitute energy, pollution avoidance, protection.

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