With rising awareness about environmental and social issues, sustainability-focused stocks might gain significant investor attention in the upcoming years. So, investors looking to cash in on the growth of the sustainability-focused investing trend in a relatively less risky way could invest in quality ETFs such as the iShares ESG Aware MSCI EM ETF (ESGE), iShares ESG Aware MSCI EAFE ETF (ESGD), Vanguard ESG U.S. Stock ETF (ESGV), and Xtrackers MSCI USA ESG Leaders Equity ETF (USSG).With growing climate change concerns and the rising need for socially responsible business dealing, environmental, social, and governance (ESG) focused investing has been gaining traction. According to a Morningstar report, sustainable funds’ total assets rose 19% to nearly $2 trillion in the first quarter, marking the hitting of a record high for the fourth quarter in a row.
Last month, S&P Dow Jones CEO, Dan Drape, said that ESG-based investing is one of their biggest growth opportunities. Moreover, according to BlackRock, Inc.’s (NYSE:BLK) head of iShares Americas, Armando Senra, ESG investments could become a $1 trillion category by 2030.
While it could be difficult to select the best socially responsible stock in the absence of organized information in this regard, investors looking to cash in on the ESG investing trend in a relatively less risky way could bet on quality ESG ETFs, including the iShares ESG Aware MSCI EM ETF (ESGE), iShares ESG Aware MSCI EAFE ETF (ESGD), Vanguard ESG U.S. Stock ETF (ESGV), and Xtrackers MSCI USA ESG Leaders Equity ETF (USSG).