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Saturna Sustainable Funds

Investment Process

The Saturna Sustainable Funds seek to invest in issuers that demonstrate sustainable characteristics. Sustainable issuers are generally larger, more established, consistently profitable, and financially strong, with low risks in areas of the environment, social responsibility, and governance ("ESG").

The Funds seek issuers with:

  • Sustainable profits
  • Strong balance sheet
  • Management strength
  • High quality operations
  • Risk consciousness
  • Long-term focus
  • Low debt
  • Established businesses

To help reduce risk, each fund invests in a globally diversified portfolio across industries, companies, and countries.

The Funds seek tax-efficiency for their shareowners and reduced trading expenses through low portfolio turnover.

Saturna Capital, the Funds' investment adviser, screens more than 10,000 global securities monthly. For the Saturna Sustainable Funds, negative screening excludes issuers engaged in activities such as alcohol, tobacco, firearms, and gambling. Then over 2,000 liquid, larger capitalization issuers are rated on multiple environmental (e.g., sustainability policies), social (e.g., workplace safety), and governance (e.g., board effectiveness) risk factors adjusted for specific sectors. Financial strength (e.g., balance sheet ratios) and additional sustainability measures (e.g., country corruption, CO2) also contribute to the Sustainability Rating assigned qualified issuers.

Our team of investment analysts rank hundreds of companies for expected future market performance. The Funds' portfolio managers then select and monitor portfolio issues meeting the requirements for issue type, sustainability, diversification, and performance expectations.

Saturna Sustainable Funds Investment Process Saturna Sustainable Funds Investment Process

The ratings process associated with sustainable investing reduces the investable universe, which limits opportunities and may increase the risk of loss during market declines. Saturna believes that sustainable investing may mitigate security-specific risk, but there is no guarantee that the securities favored by our investment process will perform better and may perform worse than those that are not favored.

Investment Objectives

The Saturna Sustainable Equity Fund (SEEFX) seeks capital appreciation. The Fund seeks to achieve this objective by investing in a portfolio of global equities that meet financial, sustainable, and responsible investment criteria.

The Saturna Sustainable Bond Fund (SEBFX) seeks current income and capital preservation. The Fund seeks to achieve this objective by investing in a portfolio of global bonds that meet financial, sustainable, and responsible investment criteria.

A Few Words About Risk

Saturna Sustainable Equity Fund and Saturna Sustainable Bond Fund

The value of Fund shares rises and falls as the value of the securities in which a Fund invests goes up and down. Only consider investing in a Fund if you are willing to accept the risk that you may lose money. Fund share prices, yields, and total returns will change with market fluctuations as well as the fortunes of the countries, industries and companies in which it invests.

Foreign investing involves risks not normally associated with investing solely in US securities. These include fluctuations in currency exchange rates, less public information about securities, less governmental market supervision and the lack of uniform financial, social, and political standards. Foreign investing heightens the risk of confiscatory taxation, seizure or nationalization of assets, establishment of currency controls, or adverse political or social developments that affect investments. The risks of foreign investing are generally magnified in the smaller and more volatile securities markets of the developing world.

Liquidity risk exists when particular investments are difficult to sell. Investments by the Funds in foreign securities and those that are thinly traded, such as lower quality issuers, tend to involve greater liquidity risk. The market for certain investments may become illiquid under adverse market or economic conditions.

Saturna Sustainable Bond Fund

The risks inherent in the Sustainable Bond Fund depend primarily on the terms and quality of the obligations in its portfolio, as well as on bond market conditions. When interest rates rise, bond prices fall. When interest rates fall, bond prices go up. Bonds with longer maturities usually are more sensitive to interest rate changes than bonds with shorter maturities. The Fund entails credit risk, which is the possibility that a bond will not be able to pay interest or principal when due. If the credit quality of a bond is perceived to decline, investors will demand a higher yield, which means a lower price on that bond to compensate for the higher level of risk.

Issuers of high-yield securities are generally not as strong financially as those issuing higher quality securities. These issuers are more likely to encounter financial difficulties and are more vulnerable to changes in the relevant economy that could affect their ability to make interest and principal payments as expected. High-yield bonds may have low or no ratings, and may be considered "junk bonds."

Check out the background of Saturna Brokerage Services, Inc. or any firm or investment professional on FINRA's BrokerCheck.