In life there are many types of investing. You might invest your time by volunteering for a cause in your community. You might invest your energy by working out to increase your health.
In the world of finance, investing usually refers to the process of using your money to purchase assets that will increase in value to generate a profit, income, or gains.
Just as with conventional investing, for responsible investing you can choose between several types of investments, often referred to as asset classes. An asset class is a group of financial instruments that have similar characteristics and behave the same way in the marketplace.
The asset classes used most often in responsible investing are:
- Stock or shares in a company, also called equities
- Mutual funds or exchange-traded funds (ETFs), which hold stock or shares in multiple companies
- Fixed-income securities, which usually mean bonds or notes
- Cash or cash-equivalents, such as a savings account or money market fund
Other asset classes not typically part of sustainable investing include commodities such as metals, energy, or agricultural goods; real estate; futures and derivatives; infrastructure; foreign currency; and cryptocurrency.
Click on the boxes below to find an explanation of each asset class commonly used in responsible investing, along with resources for evaluating your options within each type of investment:
Green America is not an investment adviser, nor do we provide financial planning, legal, or tax advice. Nothing in our communications or materials shall constitute or be construed as an offering of financial instruments or as investment advice or investment recommendations.