'Green Funds' gain ground

Socially responsible mutual funds "have been gaining interest as people begin to align their personal principles with their investment approach," says Ed Rosenbaum, vice president of research at Lipper Inc.

Approximately $10 billion is currently invested in socially responsible mutual funds, Mr. Rosenbaum notes. Many focus on environmentally friendly companies.

But because of the range of different kinds of funds available, "you have to make sure your personal view of what constitutes socially responsible investing is in line with the fund's objectives," he says. "When you group [socially responsible] funds by investment-group objective - like small cap or large cap - they're right in line with their peers, and many of them are superstars within their categories," Rosenbaum says.

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