As an investor, you likely understand the common concept of return on investment (ROI): your capital gets put in and you get something in return. However, what many investors do not realize is that you do not have to select your investments solely on their potential ROI. Instead, you can reimagine ROI through an approach known as conscious investing.
In his recent commentary as a contributor for Investing.com, GFG Capital Co-Founder Eduardo Gruener discusses the conscious investing mindset and all the potential these investments have to accomplish.
Traditionally, investors and their respective advisors create an investment policy for their portfolio that includes all the typical factors: risk profile, return objectives, time horizon, liquidity needs, etc. However, according to Gruener, there is often something missing from this process that can help align your everyday life and concerns with your portfolio: the unique characteristics that make you you.
With a conscious investment mindset, the investor blends subjective points of view and objective facts based on trends and financial performance to build their portfolio. This may be an extremely beneficial option for investors because, according to Gruener, “On top of your portfolio being a more direct reflection of yourself and values, it could end up being set up for potentially better risk adjusted returns as time unfolds.”
Additionally, by utilizing the conscious investment mindset, you are not only able to select investments that reflect your values, but your investments can also lead to better business practices that can result in greater risk mitigation, while also helping the global economy become more responsible, inclusive and sustainable.
For example, UBS has reported that family offices have seen steady increases in demand for conscious investments – which has caused many corporations around the world to adjust their approach to their daily operations through ESG, SRI, thematic investment mandates, impact investing, and more.