First Affirmative Financial Network


Investment Solutions for Responsible Investors

A Conscious Choice

At First Affirmative, we believe that investors bear responsibility for the impact our money has in the world. With First Affirmative, you are consciously choosing to make investments that contribute to a clean, healthy environment, treat people fairly, embrace equal opportunity, produce safe and useful products, and support efforts to promote world peace. We have the proven experience, resources, and commitment to help you make money and make a positive difference—at the same time.

Responsible Investing Methodology

First Affirmative's Managed Mutual Fund Portfolios are strategically allocated among funds that integrate analysis of environment, social, and governance (ESG) factors into the investment process. Model portfolios are designed to both support and profit from the best managed companies with the most positive impact on our world. Through SelectOne, First Affirmative offers seven managed mutual fund portfolios designed for conservative to aggressive investors. Our process features ongoing analysis of both the financial and non-financial characteristics of the mutual funds that utilize ESG integration. Each fund is evaluated against both a passive benchmark and its mutual fund peers on a quarterly basis. Deviations from the benchmarks are evaluated and attributed. Careful attention is paid to any changes in portfolio managers or investment strategies. Funds are chosen based on asset class considerations, quality and discipline of investment process, along with lower expense ratios when possible. Asset allocations and weightings are based on risk profile, stock to bond ratio, and investment objectives. Our deep knowledge of SRI fund companies and managers helps us to stay on top of shifts in personnel and process. From time to time we will add new funds, eliminate funds and/or substitute one mutual fund for another. These changes may be warranted by any number of considerations, including (but not limited to) relative performance vs. peer group over time, the availability of new funds, or significant changes in funds' management team(s), investment style, or focus. First Affirmative's Managed Mutual Fund Portfolios are strategically allocated among funds that integrate analysis of environment, social, and governance (ESG) factors into the investment process. Model portfolios are designed to both support and profit from the best managed companies with the most positive impact on our world. Through SelectOne, First Affirmative offers seven managed mutual fund portfolios designed for conservative to aggressive investors. Our process features ongoing analysis of both the financial and non-financial characteristics of the mutual funds that utilize ESG integration. Each fund is evaluated against both a passive benchmark and its mutual fund peers on a quarterly basis. Deviations from the benchmarks are evaluated and attributed. Careful attention is paid to any changes in portfolio managers or investment strategies. Funds are chosen based on asset class considerations, quality and discipline of investment process, along with lower expense ratios when possible. Asset allocations and weightings are based on risk profile, stock to bond ratio, and investment objectives. Our deep knowledge of SRI fund companies and managers helps us to stay on top of shifts in personnel and process. From time to time we will add new funds, eliminate funds and/or substitute one mutual fund for another. These changes may be warranted by any number of considerations, including (but not limited to) relative performance vs. peer group over time, the availability of new funds, or significant changes in funds' management team(s), investment style, or focus.

Sustainable Risk Management

Most investors share a common goal—to own investments that maximize growth potential

while controlling the risk of loss. Investors with long time horizons are often better able to endure temporary market fluctuations. Investors with relatively short time-horizons tend to be more risk-averse.


We believe that diversification is the most effective way to manage and reduce risk in a portfolio. Each First Affirmative model portfolio owns 18-20 funds. A thorough diversification process combines dissimilar asset classes in a single portfolio and can Smooth the Ride, especially during volatile market conditions—making it easier to stick with a disciplined investment plan.

In those asset classes where we have a number of strong funds and/or managers from which to choose, we will often diversify among several funds within the same asset class. We call this Three Dimensional Diversification.




Quantitative + Qualitative Analysis

    There are no perfect companies. Conventional quantitative security analysis plus qualitative analysis of environmental, social, and governance (ESG) factors can identify better companies—companies of the future. During the past thirty years, responsible investors have led businesses across three developmental phases.

    Phase I called for a "Do No Harm" approach. Investors were primarily focused on avoiding companies that were environmentally negligent, or that produced harmful products like tobacco.

    In Phase II, "Doing Well by Doing Good" described how many companies worked to reduce costs and enhance profits through pollution prevention, waste minimization, energy efficiency, and other relatively simple business strategies.

    Now, in Phase III, "Sustainability" is driving top line growth. Integrating sustainable business practices across operational platforms is encouraging innovation, increasing sales, improving customer retention, attracting talent, and offering competitive advantage.

    First Affirmative focuses portfolio holdings on companies of the future—companies that have demonstrated a commitment to sustainability, accountability, and ethical practices. Portfolios are designed to earn competitive financial returns while investing in enterprises that make a positive impact on our world.

Follow the Leader

First Affirmative Financial Network is a leading provider of investment management services for socially conscious investors. We produce the premier annual event for the sustainable and responsible investment industry in North America: The SRI Conference - on Sustainable, Responsible, Impact Investing (www.SRIconference.com). Our independence and objectivity removes any pressure or incentive to include specific mutual funds in client portfolios. We don't earn commissions, we have no soft dollar arrangements, and our knowledge of the people and processes behind the funds we use offers us an edge in the pursuit of strong portfolio performance and in the management of portfolio risk. At First Affirmative, we believe that bringing personal values and financial decision-making into alignment is a powerful way to encourage behavior that enhances quality of life for all. We welcome you to join us!

 


First Affirmative Financial Network, LLC
5475 Mark Dabling Boulevard, Suite 108
Colorado Springs, Colorado 80918
877.540.4933 x101 (Boulder office—for sales/marketing assistance)
www.firstaffirmative.com
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