Alternative Investments/ESG: London Based Sparrows Capital Adds ESG to Model Portfolios

Sparrow has added ESG portfolios to its SCore MPS model portfolio service.

Sparrow Capital’s platform-based model portfolio service, SCore MPS, is being augmented by the inclusion of the SCore Responsible MPS range of ESG portfolios.

The SCore Responsible MPS

The SCore Responsible MPS range comprises 11 portfolios. Each has an equity exposure to a varying degree from 0 to 100%. Financial advisors can therefore find tune their selection of an ESG portfolio depending upon the client’s risk appetite. (ETF Express)

Moreover, Sparrow Capital has the benefit of the ESG expertise of Prof Elroy Dimson. Heis on its board as a consultant.

Dimson is on the ESG Committee for the FTSE Group, co-directs the Centre for Endowment Asset Management at Cambridge Judge Business School, and is Emeritus Professor of Finance at London Business School.

Investment Manager, Mark Northway, on ESG

Sparrow Investment Manager Mark Northway says: “The marketing machine suggests that there is an incremental return associated with virtuous investing, but this has historically not been the case. But for the last seven to 10 years, the returns from high ESG ranking stocks have been flattered by the momentum effect of a huge transfer of capital from sin stocks to virtue stocks. As capital moves from asset type A to asset type B the former will tend to lag and the latter will outperform.”

About Sparrow Capital

  • managing money since 2008 in an evidence-based portfolio strategy
  • since 2014 as a fund manager offering its services to wealth managers and financial advisers
  • portfolios of ETFs and index funds deliver the evidence-based approach
  • AUM is less than half a billion pounds
  • charges are 10 basis points per annum, capped at GBP20 per client per month.

“This means that people with reasonably sized portfolios of GBP500,000 pay less than 5 bps per annum,” Northway says. “As the portfolio size grows, the fees continue to reduce.”

“Price disruption is a major part of what we are about.”

Related Story:      ESG Investments Are Now Mainstream And Core Portfolio Elements

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