In this edition of Your FAQs, Answered, we are sharing answers to general questions we receive about Encasa, our funds and Responsible Investing. Some answers you may be familiar with and some, not so much. Whether you are a long-time Encasa investor or new to the organization, take a read below to learn more about Encasa.
1. What are the Encasa Funds?
Great question! We offer three mutual funds designed as a group to align with investors’ risk tolerance, investment needs and liquidity requirements.
The Encasa Short-Term Bond Fund invests primarily in high-quality Canadian short-term bonds. This fund may be suited for investors with a low tolerance for risk, who have a shorter time horizon and are seeking higher levels of current interest income compared to money market fund investments.
The Encasa Bond Fund may fit well for investors who do not plan to access their funds in the short-term but are planning their spending requirements in the near future. The Encasa Bond Fund investments primarily in investment grade bonds of Canadian governments and corporations.
The Encasa Equity Fund is broadly diversified across the global stock market. It is designed for investors who do not need access to their capital in the short-term and are comfortable with the return/risk profile of investing in the equity markets.
Take a look at Encasa Funds, Explained to learn more about the Encasa Funds.
2. I keep hearing about taking a portfolio approach. What is a portfolio approach and why is it important?
Taking a portfolio approach means considering your short and long term goals, and matching your whole portfolio to these, taking into consideration your risk tolerance, and the inherent risk of the investment being made with the probability of achieving the returns being targeted. This includes using diversification strategies within a portfolio of investments. Diversification is the ultimate risk management strategy. Diversification means thinking about your portfolios as a puzzle, with different pieces that bring different characteristics.
Instead of approaching investments fund by fund, a portfolio strategy sets the overall goals, and then allocates among the Encasa funds in a way that is most likely to achieve these goals. This is a more prudent strategy. If you’re interested in learning more about diversifying your investment portfolio, contact us at email@example.com. We would be happy to help.
3. What is Responsible Investment and where did it originate?
Responsible Investment (RI) integrates environment, social and governance (ESG) factors into the investment decision-making process. Responsible Investment is a philosophy that goes back hundreds of years and across the globe. The principles of Islamic finance shun investments that related to activities prohibited by Islam, such as gambling and alcohol. Methodists were encouraged to, “…avoid partnering or investing with those who earned their money through alcohol, tobacco, weapons, or gambling (sometimes referred to as sin stocks).”*
For us at Encasa, RI has led our investment philosophy for over 18 years. Encasa Funds are invested in companies which conduct themselves in a socially responsible manner, and whose business practices favour the environment, promote workers’ rights, and demonstrate strong governance.
More recently, RI has emerged as a leading investment strategy across the world, and we believe, will continue to grow as the most advantageous investment approach.
Have a question about managing your investment account? Chances are that others may have it too. Send us an email at firstname.lastname@example.org and we will answer your questions in a future edition.