Do-Good Funds Spurned for Safer Bets as Quarterly Losses Mount
- US investors pulled $5.2 billion from ESG funds last quarter
- New ESG fund debuts reached 27, topping fourth-quarter number
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US funds that choose stocks based on environmental, social and governance criteria posted outflows for the second consecutive quarter as investors fled to safer assets amid Federal Reserve rate hikes.
Investors yanked $5.2 billion from US-domiciled sustainable funds in the first quarter of this year, according to a report by Morningstar Inc. The exodus was driven by the $13.6 billion iShares ESG Aware MSCI USA ETF (ticker ESGU), which shed $6.5 billion over that period.