Can you make money by feelings?Here, it’s really possible
On the night of February 4, the Opening ceremony of the Winter Olympic Games was held, counting down from the 24 solar terms to the water of the Yellow River, from the ice Cube gradually broken, to the crystal clear ice and snow rings…A romantic atmosphere of creativity let a person look unforgettable!Among them, let me the most impressive, is undoubtedly the main torch ignition, “no ignition” instead of “lit”, “small fire” instead of raging fire, transmission of low-carbon, environmental protection of the green Olympic concept, the Realization of the Olympic history of a ignition innovation.The way of lighting the main torch is actually “one leaf knows autumn”, which tells us that with the continuous development of economy, the value orientation of the society is changing.In fact, investment is also very value oriented. From the point of low carbon and environmental protection, I think of the ESG investment concept that has become popular in the past two years.At present, China Amc has also launched an ESG theme fund — China ESG Sustainable Investment One-year Holding period hybrid Fund (CLASS A: 014922, class C: 014923), which is selling well on various platforms.Take this opportunity to talk to you about what ESG investment is.ESG, short for Environmental, Social and Governance, is a popular investment concept in the global securities market in recent years. It focuses on the traditional financial performance as the main factor for investment decision making.Extended to the green, sustainable development, public interests and good corporate governance, and other fields, focus on innovation and development, low carbon environmental issues such as, common prosperity and more comprehensive consideration of the environmental impact of business and investment activity, more emphasis on the enterprise and the relationship between all stakeholders rather than shareholders, pay more attention to the balance of short-term interests and long-term interests.Initially, ESG investments were primarily used to do negative screening, that is, not to invest in those that did not meet THE ESG criteria.For example, in the past, the church did not invest in gambling, alcohol, tobacco, guns and other “sinful” industries.Now, in addition to negative screening, ESG Investments systematically considers the impact of all aspects of ESG on the company’s stock price.Since the 21st century, under the initiative of the United Nations and other public institutions, ESG’s investment has become increasingly hot.Since the outbreak of COVID-19, countries have also emphasized sustainability and green issues as important considerations in economic stimulus policies when formulating economic recovery plans.In China, ESG investment is also more and more valued.For example, the establishment of the dual carbon target has played a huge role in promoting THE E(Environmental) in ESG investment.The goal of “common prosperity” puts forward new requirements for capital, and investors’ attention to S(Social) is expected to be greatly increased.Some people may ask, ESG is not feelings?Can you make money by feelings?Statistical data show that since 2020, THE A-share market ESG fund significantly outperformed the market, and actively managed funds significantly better than passively managed funds.Why does ESG work?What are the benefits of investing in ESG?1. ESG is about brand image.As per capita income rises, it is not only practical but also emotional values that matter when we buy things.For example, if your product is environmentally friendly and the enterprise is caring, sales may be better.For example, during the henan flood, Hongxing Erke became famous because of donations. The store was sold out of stock, and the brand popularity came up at once.2. ESG is about corporate culture.If enterprises invest more in ESG, they will not have a cold employment relationship with employees, which can enhance employees’ sense of belonging and identity, improve work efficiency and attract more excellent talents.ESG is about policy support.For example, environmental protection, there will be green bonds and other instruments to support companies that do good environmental protection.By the end of 2020, global issuance of green bonds and loans had reached $1.1 trillion, with China accounting for $139 billion, or 8% of the global total.For example, new energy vehicles, photovoltaic, etc., usually have a lot of subsidies or tax breaks in the early stage of development.Conversely, companies that do not do well on ESG may face policy risks.For example, the “eight rules” affecting the liquor sector, the quantity purchase of medicine, the influence of game plate number on game companies, and the policy of K12 education and training institutions.To sum up, from the perspective of investment, ESG is not only a means of risk prevention, but also a way to generate α, which can not only prevent risk but also deal with the future — companies that do well in ESG tend to capture new business, and companies with good ESG are prone to further increase in valuation.More importantly, since “carbon peak” and “carbon neutrality” were established as the long-term strategic goals of the country, ESG has changed from “looking beautiful” two or three years ago to “knocking at the door”.The capital market took action, and a group of management institutions with a sense of social responsibility and vision have already set out, such as China Amc, which has been deeply engaged in THE ESG field for more than four years.As early as 2017, China Amc became the “early adopter” of domestic public funds in the FIELD of ESG, becoming the first domestic public fund to join PRI (United Nations Organization for Responsible Investment Principles).In the same year, ESG investment Research team was quickly established. Based on the characteristics of Chinese listed companies, the team developed a set of sustainable investment research framework applicable to the local market.In 2020, China Amc set up an ESG business committee at the company level, responsible for the overall management of the company’s ESG investment and promotion business, and became the first public fund company in China to set up an ESG business committee at the company level.At present, China Amc has deeply integrated ESG investment philosophy into all aspects of active equity investment and international account management, and realized ESG integration of the whole investment process. From the formulation of investment strategy, to basic industry research, to portfolio construction and daily risk management, ESG considerations have been added.China Amc’s practice in THE ESG field has also won authoritative recognition from around the world. The company was awarded the highest grade A+ in the “strategy and Governance” module in the PRI2020 annual evaluation.In order to help ordinary investors better share the long-term value of the market through ESG concept, China Amc also launched an ESG theme fund recently — China AMC ESG Sustainable Investment One-year Holding Period Hybrid Fund (Class A: 014922, Class C:014923), which focuses on high-quality investment funds with sustainable development space and positive externalities to environment, society and stakeholders through in-depth analysis of stocks related to ESG’s sustainable investment theme;The proportion of the fund’s equity investment in the fund assets is 60-95%, and the proportion of the Hong Kong stock connect’s equity investment in the stock assets is 0-50%;The fund invests no less than 80% of its non-cash fund assets in ESG sustainable investment themed securities as defined by the Fund.Zhongning Pan, the proposed fund manager, holds a bachelor’s degree in engineering and a master’s degree in economics from Wuhan University, and an MBA from Georgetown University. He has more than 23 years of experience in the securities industry. He has witnessed the development of China’s capital market through the bull and bear experience.Pan Zhongning is one of the early fund managers who contacted and practiced THE concept of ESG in China and has unique views on ESG.His representative work is Huaxia Qianlong Selection. As of December 31, 2021, the cumulative yield of the product has reached 138.6% since its establishment, surpassing the benchmark yield of 111.6%, and the annualized yield has exceeded 30% since its establishment.It is commendable that Huaxia Qianlong selected portfolio industry configuration is balanced, not only bet on the track, the performance is mainly contributed by stock selection.Finally, I would like to remind you that Huaxia ESG sustainable Investment One-year hold (Class A: 014922, class C: 014923) is on sale, and interested readers can pay attention to it.Risk note: Views are for reference only and do not represent investment advice.There are risks in the market and investment should be cautious.