Using ESG Portfolio Customization to Align Values and Investments

Modern investors want their capital to reflect their values. Fortunately, investment techniques and technology allow investors and advisors to build portfolios reflecting their deeply held environmental, governance and social (ESG) philosophies. 

Financial services firms are constantly evaluating investments available to the public—and increasingly, they’re looking at the manner in which those investments impact the environment, run their companies and handle social problems. Those factors are then incorporated into the ratings of individual securities.

With more information available, investors and advisors have embraced ESG investing and customized portfolio construction. It’s a personalization revolution. Investors and advisors are able to incorporate ESG factors into their own portfolio construction, investing in companies with well-aligned values and ruling out securities that don’t match their principles. 


The Power of ESG-Based Portfolio Construction

The best technology vendors are enabling advisors and investors to match their personal standards to their investments. Modern advisors have powerful portfolio-building tools, like automated trading tools and advanced screeners. They even have customizable and dynamic risk tolerance questionnaires, to help drill down into the values held by their clients.

In fact, customizable risk tolerance questionnaires provide both investors and advisors with an unmatched opportunity to build picture-perfect ESG portfolios. By uncovering an investor’s preferences before investing, advisors and self-directed investors can include or exclude specific securities based on client preferences or risk tolerances. 

Taking customization even further, investors and advisors can utilize algorithmic portfolio construction, based on responses to specific risk or values-based questions. It’s a level of customization previously unavailable to almost all investors.


Turbocharging ESG Investing

Now that the technology for building ESG-focused portfolios is available, advisors can match their clients with models reflecting investors’ values. Meanwhile, self-directed investors can reference curated lists of highly-rated ESG securities, building their own models. 

FusionIQ’s Portfolio Management tools allow advisors, and their end clients, to pick and choose securities to include or exclude in their portfolio. Giving investors more control over their portfolios enables them to decide how their investments align with their values. 


FusionIQ’s Revolutionary Digital Wealth Management Experience

FusionIQ provides convenient and powerful access to ESG strategies and models. Historically, values-based investing was reserved for high-net worth individuals with access to proprietary information. Today, advisory firms can offer customized risk and values-based questionnaires, ESG models and portfolio construction using FusionIQ’s technology and model management tools, unlocking greater customization at a lower cost. 

FusionIQ’s Digital Investing Platform provides advisory firms with powerful innovation. Its unique investment strategies, customizable and dynamic Risk Tolerance Questionnaire, and ESG offerings are available directly to advisors, to provide to their own end-clients. Firms can also provide access to this solution as a white-labeled product for self-directed investors. 

Are you interested in understanding more about how our technology can work for you? Contact us to see a personalized demo.

John Guthery, CFA <br> Chief Investment Officer
John Guthery, CFA
Chief Investment Officer

John is a highly respected investment executive, bringing more than 27 years of experience to his role as Chief Investment Officer for FusionIQ. As CIO, John focuses on developing advisor platforms and business lines including finTAMP and Digital Model Marketplace. He also contributes to FusionIQ’s thought leadership and market analysis.

John’s extensive financial services background includes leading market research, due diligence and platform enhancements for top-tier wealth managers including LPL Financial, where he spent 19 years running product research, Park Avenue Securities, Voya Financial and WP Carey where he helped to design and manage public and private real estate funds and public BDCs. | Connect on LinkedIn

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