Tag Archives: S&P 500 ESG Index

Is ESG a Factor? The S&P 500 ESG Index’s Steady Outperformance

Since launching the S&P ESG Index Series, we have been continuously asked the same question: Can environmental, social, and governance (ESG) be considered a factor that outperforms? In short, since its launch in January 2019, the S&P 500® ESG Index has outperformed (see Exhibit 1). We further analyzed the performance characteristics of the S&P 500 Read more […]

Move over Millennials: ESG Investing Is a Multigenerational Conversation

The COVID-19 pandemic has shaken financial markets and led many market participants to take a closer look at their investments. While emotionally and psychologically challenging, these selloffs can create opportunities to enhance long-term portfolio objectives. In this environment, advisors can demonstrate their value by helping clients invest in strategies they find meaningful and motivating. Investors Read more […]

Who’s In? Who’s Out? Walmart & Twitter Dropped from the S&P 500 ESG Index, among Other Major Changes

After markets closed on April 30, 2020, the S&P 500® ESG Index underwent its second annual rebalance since it launched in January 2019. Last year, the rebalance resulted in some changes that hit the headlines—most notably, the removal of Facebook from the sustainable version of the iconic S&P 500. With markets currently in turmoil due Read more […]

Through the Turbulence, a New Breed of ESG Indices Delivers

Have the new beta-like ESG indices delivered on their objectives, notwithstanding the market turmoil? The answer is yes, and then some. The S&P 500® ESG Index has provided low tracking error relative to the S&P 500 and similar risk, but also a better return. For decades, growth in ESG investing was unremarkable, held back by Read more […]

ESG: Why Not? Insignificant Alpha Observed between the S&P 500 ESG Index and the S&P 500

Does the S&P 500® receive a premium over the S&P 500 ESG Index? Absent a premium from the S&P 500, investors could have their cake and eat it too with the S&P 500 ESG Index: similar or better performance, along with the benefits of ESG. Academic literature suggests no sin stock premium over their non-sin Read more […]

Why Facebook Was Dropped from the S&P 500® ESG Index

When the S&P 500 ESG (Environmental, Social, and Governance) Index underwent its annual rebalance after markets closed on April 30, 2019, several notable companies were removed, including Wells Fargo, Oracle, and IBM. However, the largest component to be dropped was Facebook. A day before its exclusion, Facebook held a weight of 2.5% in the S&P Read more […]