"Grantham and colleagues have looked at the S&P500, over the last 28 years, 60 years, and 90 years; excluding a major sub-component sector each time. Grantham′s overall conclusion it that it didn′t make much difference in return – although some might argue at the max range of 50bps that compounded over 28 years may be significant. Others might suggest that the power of diversifcation and time, also makes this conclusion unsurprising."
[COMMENTARY]This study helps counter the argument that reducing the number of investments inevitably leads to lower returns. Thank you Grantham and colleagues, for shedding some light on what is perhaps the number one argument that ethical investors and advisors hear from ’unbelievers!’
Divesting sectors. The impact on returns. Evidence that oil divestment may not impact returns, June 22, 2018, ThenDoBetter, UK.