ESG & Investor-Centered Publication Platform: How It Is Different From a Broker-Dealer Platform
An Investor-Centered Select Publication Platform puts the investor first.
Every Fund on Check the Ticker select publication platform must demonstrate it acts in the best interest of the growth of retail investors’ retirement assets.
An Investor-Centered Select Platform puts the investor first.
- Is the Gross/Net Expense Ratio less than 1%?
- Is the portfolio turnover in accordance with its category and in general 10-40%?
- If the Fund is an active Fund, does its performance exceed its relevant benchmark for over five years (one exception on the Check the Ticker Publication Platform is two ESG Funds, since the Category is a new category)?
- Can the Fund be purchased directly, without an Advisor and without excessive 12b-1 fees or commissions (sales loads)?
How can a fund have a five star rating and a five-globe rating for sustainability from Morningstar without putting the interests of the investor first?
Is it not implicitly assumed that an investment recommended to a retail investor, someone saving for retirement, is an investment rated with the investor’s interests first?
Aspiration ESG Fund, REDWX, is one example of a Fund with a Morningstar sustainability rating of five globes and fire stars that would not meet the standards of Check the Ticker select publication platform.
As of June 30, 2019, Morningstar assigned a Five-Star to REDWX, Aspiration Redwood and it ranked 2 in Morningstar’s 3-year return category, Large Blend.
Using Check the Ticker ESG compliant screen to ensure this Fund operates in the best interest of the retail investor we verified the data:
- The Net Expense ratio is over 1%, in fact it far exceeds category average and is 2.51% of .95% for large blend. The Gross Expense Ratio is 3.67%.
- The Fund portfolio turnover is excessive at over 110%, creating high portfolio transaction expenses that are not reflected in the return charts, highlighted below.
- The Chart below demonstrates that REDWX has underperformed its relevant benchmark for the last three years.
- REDWX charges another .24% 12b-1 fee , annually, that further diminishes performance and actual returns to its retail investor through obsolete distribution methods that are not in a retail investor’s best interest. “Shares of the Funds may only be purchased by clients of the Adviser.”
Most concerning is Aspiration’s misrepresentative advertising concerning REDWX:
“The Aspiration Redwood Fund uses a rigorous analysis of companies’ sustainable environmental, workplace, and governance practices to find investments we believe are poised for growth. Our goal is to help you build value and honor your values – all at the same time.”
Aspiration Redwood Fund charges retail investors almost twice for the exact same service that an ESG compliant Fund typically provides. At Check the Ticker Publication Platform, retail investors eliminate all these redundant fees by going direct to the Fund, (or purchasing the Fund at a broker-dealer self-directed platform for under $50).
After all the payments to intermediaries and Aspiration how is the performance of REDWX compared to Check the Ticker top performing ESG Integration Fund and top performing Growth Fund at its select publication platform?
The dark blue line on the bottom of the Chart represents the performance of Aspiration Redwood (REDWX) for the 2-year period. The fund is not five years old.
The red line is the performance of Check the Ticker ESG Integration fund from its publication platform.
The yellow line is the S&P 500 index.
The green line is Check the Ticker publication platform top performing growth fund.
It is clear that all the fees, intermediary payments and high net expense ratios impact the performance of REDWX.
Sustainability and an Investor-Centered Publication Platform
A sustainable workplace and basic ethical governance practices does not charge excessive expense ratios in their Fund, while simultaneously posting on their website, false and misleading statements to the media, as demonstrated in this statement:
“The fund launched in November 2015. Parent company Aspiration’s website calls itself a “financial firm for all.” The firm offers two mutual funds and other financial services such as banking and IRAs. The focus is on low fees and transparency in the company’s products and services.”
High portfolio turnover, expense ratios greater than the category, pay to play intermediary cash payments, bonuses and meals and tickets to entertainment should never be funded by an investor’s retirement assets.
We provide data directly from Aspiration Redwood (REDWX) Prospectus concerning payments to Advisor, intermediaries, include “entertainment” used to sell their ESG Fund:
“In addition to member firms of the Financial Industry Regulatory Authority, Inc. (“FINRA”), the Adviser or Distributor also reserves the ability to make payments, as described above, to other financial intermediaries that sell or provide services to the Funds and shareholders, such as banks, insurance companies, and plan administrators. These firms may include affiliates of the Adviser. The Adviser, the Distributor and their affiliates also may pay non-cash compensation to financial intermediaries and their representatives in the form of (1) occasional gifts; (2) occasional meals, tickets or other entertainment; and/or (3) sponsorship support of regional or national conferences or seminars. Such non-cash compensation will be made subject to applicable law.”
Check the Ticker Investor-Centered Publication Platform recommends Funds that far outperform REDWX which are sustainable both for ESG and for the retirement investor.
These Funds can be accessed directly with one click to the Fund Company that chooses to place the retirement investor’s growth of assets ahead of non-transparent, disingenuous pricing that is confusing and misleading to the retail investor, not to mention very poor performance, when other Funds outperform their relevant index at far less costs and overall expense.
Join us at Check the Ticker today to access these top performing Funds either at our direct publication platform or through your broker-dealer of choice. Follow us on Twitter @checkticker #bestinterestinvestor.