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The Short Answer

Find The Right Socially Responsible Fund

Options for those who want to invest according to their social conscience.

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In a recent column, we took a look at the variety of religiously oriented mutual funds that are available to investors. Although that's a rapidly growing group, there are still plenty of funds out there that practice socially responsible investing but don't have religious associations. Most secular SRI funds avoid alcohol, tobacco, and gambling stocks, but beyond that they vary quite a bit in the criteria they use, just as the religious funds do. That can be both good and bad. On one hand, there are lots of choices for SRI investors, but on the other hand, it's hard for beginners to sort through all the options.

We can't tell you which SRI fund to buy, or whether to buy one at all, as that is a personal decision based on your own values. What we can do is survey the SRI landscape and group these funds into some broad categories, in order to make it easier to zero in on those that might be right for you. As with the religious funds, you may have to pay a bit more for the social screening, but the peace of mind can be worth it if certain principles are important to you.

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David Kathman does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.