SMART (Sustainability Metrics Applied to Risk Tolerance)®
Investing Solutions for Financial Professionals
Sorting through the Sustainable, Impact, and ESG (Environmental, Social, and Governance) Investing world can be a very costly and time consuming process, which is why we’ve created SMART Investing Solutions for Financial Professionals. Our main interest is saving advisors the time and expense they might incur researching this rapidly growing and ever changing world on their own, so that they can remain focused on their clients.
The interactive chart below outlines many of the potential risks we see associated with current ESG research and education, as well as the unique benefits of our services. Please feel free to click on any of the elements below. We also invite you to download our free brochure below the chart to learn more about what we can offer you and your financial practice.
Advisors often think that in order to offer Sustainable/Impact/ESG portfolios, they need to sacrifice return. In reality, ESG is another powerful layer of due diligence to protect your clients. With the right screening, portfolio construction, and tools, advisors can actually provide competitive returns with less volatility:
Meet With Us About SMART Investing Solutions for Financial Professionals
ESG: The GPS of Investing®
At Gitterman Wealth Management, we refer to ESG as the “GPS of Investing,” in that we see many similarities between ESG (Environmental, Social, and Governance) data and a car’s GPS system.
What does a GPS system do? It allows for information, accumulated through big data and artificial intelligence, to come into our car or handheld device, helping us navigate any given trip we’re taking. GPS alerts us to things like traffic and hazzardous road conditions, providing us with live feed information to reroute us when necessary.
ESG is a similar type of data set, giving us real-time information from all over the world about environmental, social, and corporate governance issues that companies are facing. It is a risk mitigator and alpha generator, making it easier for us to achieve our investment goals safely. ESG is the foundation of a good portfolio because it helps avoid the potential pitfalls and hazards of intangible asset risk, and will also allow us to vote with our money in ways that we cannot yet imagine.
ESG Investing on the Rise
Over the next 15 years, nearly $24 trillion in assets will be transferred to millennials,(1) and their value-conscious behavior will drive many of their investment choices. Research shows that over 83% of millennials and 70% of women are interested in Impact, ESG, and Sustainable Investing.(2)
Now is the time to differentiate yourself as an advisor and capture a part of the biggest transfer of wealth in history. With the convergence of the generational wealth-transfer, growing desire for Impact/ESG investing, recent improvement of analytical screens, and new products coming to market, now is the perfect time for advisors to:
- Differentiate themselves and grow their firm’s assets
- Respond to their clients’ desire to align their portfolios to achieve returns while also doing good for the world
- Improve the dismal 2% capture rate of generational inheritance transfers of wealth among advisors (3)
- Become a highly-valued steward of their clients’ wealth
For advisors who currently want to capture the Impact trend, one of their main frustrations is the time needed to screen a complex universe of funds, construct Impact/ESG portfolios, and create client education tools, as it takes too much time away from their existing business and prospecting. This is why Gitterman Wealth Management has created SMART Investing Services for Financial Professionals.
SMART Investing Solutions for Financial Professionals is one of the first turn-key portfolio construction and marketing solutions for advisors interested in Impact and ESG Investing. It gives them everything they need to market and deliver services that provide an added layer of due-diligence, respond to the rapidly growing trend of Impact/ESG Investing, and generate competitive returns.
(1) “Why incorporate Impact investing into your conversations with clients.” Trilinc Global, www.trilincglobal.com/financial-advisors/
(2) Investing with Impact: Create Economic, Social and Environmental Value. NYC, Morgan Stanley Wealth Management GIC. Client Conversations: Global Investment Committee. http://www.scl.bz/zz1s5dz-media.pdf
(3) Sisk, Michael. “How to Keep the Kids.” Barron’s, www.barrons.com/articles/SB50001424053111904210704576357873121823708.
Over the next fifteen years, nearly 24 trillion dollars in assets will be transferred to millennials and their value-conscious behavior will drive many of their investment choices. SMART Investing Services for Financial Professionals seek to improve the dismal 2% capture rate of generational inheritance transfers of wealth among advisors. Research also shows that over 83% of millennials and 70% of women are interested in Sustainable, Impact, and ESG Investing.
Without a clear understanding of the underlying holdings in the currently titled ESG / Impact fund universe, advisors are in jeopardy of falling victim to “green washing” and presenting their clients with options that do not meet their values and requirements.
Recent studies show that many individual advisors working on their own are underperforming model-based portfolios by an average of 200%
For advisors who currently want to capture the ESG trend, one of their main frustrations is the time needed to screen a complex universe of funds, construct Impact / ESG portfolios and create client education tools, as it takes too much time away from their existing business and prospecting.
 Srinivas, Val, and Urval Goradia. “The future of wealth in the United States Mapping trends in generational wealth.” Deloitte University Press, Deloitte, 9 Nov. 2015, dupress.deloitte.com/dup-us-en/industry/investment-management/us-generational-wealth-trends.html.
 Sisk, Michael. “How to Keep the Kids.” Barron’s, www.barrons.com/articles/SB50001424053111904210704576357873121823708.
 Investing with Impact: Create Economic, Social and Environmental Value. NYC, Morgan Stanley Wealth Management GIC. Client Conversations: Global Investment Committee. http://www.scl.bz/zz1s5dz-media.pdf
 Britton, Diana. “Broker/dealer Execs Warned on Risks of Rep as PM Platforms.” WealthManagement.com, 26 Jan. 2017, www.wealthmanagement.com/industry/brokerdealer-execs-warned-risks-rep-pm-platforms
SMART Investing Services for Financial Professionals quantify alpha in three different ways: portfolio construction, manager selection, and new fund development.
Diligence / Compliance
We analyze the entire Sustainable / ESG fund universe and perform ongoing due diligence to ensure the investments selected are best-in-class.
Due to our size and relationships in the industry, we receive institutional portfolio analysis from Goldman Sachs, Fidelity Investments, and third party quantitative and macro managers. We also utilize Morningstar’s Direct-Institutional Investment Analysis Platform to steer asset allocation and sector weightings and optimize portfolio construction.
We have been constructing portfolios for over 15 years, and our seasoned team has a wealth of experience successfully managing models through numerous macroeconomic cycles. We design our portfolios across industry standard risk iterations for ESG metrics and have the ability to customize for negative screens and multiple themes (i.e. fossil fuel free, GMO free, gender lens, etc.)
Education / Implementation
SMART Investing Services for Financial Professionals will ensure you are up-to-date on all important news and events relevant to the portfolio so that you can stay ahead of the curve and focus on your clients. This includes webinars, phone calls, and coaching designed to fit each advisor’s unique business model and clientele.
As a part of SMART Investing Services for Financial Professionals, advisors receive whitepapers, articles, and blogs authored by industry experts, as well as relevant, award-winning film footage and video feeds to help you build client facing events and web presence. Our goal is to make you a topic expert to your client base and centers of influence.
SMART Investing Services for Financial Professionals allow advisors to leverage our multiple investment analyses and risk solutions through one flat fee. The software programs we use are designed to dive deeply into the underlying holdings, sector weightings, and risk attributions of each fund in order to help advisors better understand the risk exposure to their clients.
The pricing for SMART Investing Services for Financial Professionals is deliberately designed to be less expensive than if you were to do all of this work and research yourself. We are also extremely conscious about keeping fund expenses low without sacrificing returns.