Dear Clients, Partners, and Friends:
CCM is proud to celebrate 20 years of achieving our mission of delivering superior risk-adjusted returns through investment strategies that contribute to positive environmental and social outcomes. As we reflect on the past 20 years, we are so pleased with our role in the evolution of impact/ESG investing.
In 1999, we launched an innovative mutual fund, one that enables shareholders to customize their investments into specific communities of their choosing while supporting vital community development activities such as affordable housing, job creation, and neighborhood revitalization. It started with our first bank shareholder, Monroe Bank and Trust, and has since morphed into more than 300 financial institutions and hundreds of institutional shareholders – including religious organizations, foundations, nonprofits, and high net worth investors – seeking a bespoke impact investing vehicle.
In 2001, our first separate account client – a Foundation – sought a customized approach to achieve their mission. Since then, our impact customization capabilities have grown and diversified in conjunction with our client base. Thanks to your input and confidence in CCM, we have invested close to $10 billion across 18 positive impact themes including environmental sustainability, disaster recovery, gender lens, and affordable housing, among others. In fact, our first gender lens investment was made in 2002, and our first green investment was in 2000, long before both gender lens and environmental sustainability were impact investing themes.
We have been able to achieve these powerful impact results while also providing returns that are consistent with an intermediate core mandate, but with lower volatility and greater diversification than most other core managers who closely track the Bloomberg Barclays Aggregate Index (“Index”). To illustrate, we looked at calendar year returns since our flagship Core Fixed Income Composite’s inception and found that in the years when credit was the worst performing major sector of the Index, the Composite outperformed 83% of the time. Conversely, in the years when credit was the best performing major sector of the Index, the Composite underperformed 78% of the time. Looking at the last 20 years when credit neither led nor trailed, the Composite outperformed 75% of the time. This return pattern has given our clients better portfolio stability in times when they needed it most. This was especially evident in 2008 when many Core managers posted negative results due to their heavy corporate bond exposure. Additionally, for clients who use optimization techniques to determine asset allocation, this return pattern can allow the ability to allocate to other strategies in higher-risk asset classes than if they had invested in a traditional core bond mandate with a heavy allocation to corporate bonds.
Our tradition of creating impact/ESG investing products with the goal of highly consistent return streams and lower risk profiles expanded in 2013 with a market-neutral, income-oriented ESG fund, and, in 2018, with two equity impact/ESG strategies.
We are excited about the advancement of impact/ESG investing and continuing to help you achieve your specific impact and investment goals via customized, positive impact portfolios. We invite those interested in learning more about our 20 years of impact innovation and the future of impact/ESG investing to a live webinar on September 25th at 2:00pm ET. Click here to register for the webinar.
Thank you again for your support.
Alyssa Greenspan, CFA
Community Capital Management, Inc. is an investment advisor registered with the Securities and Exchange Commission under the Investment Advisers Act of 1940. Impact figures mentioned in this report are approximate values. Past performance does not guarantee future results. Market conditions can vary widely over time and can result in a loss of portfolio value. A full list of regulatory disclosures for Community Capital Management, Inc. are available by visiting: https://www.ccminvests.com/regulatory-disclosures/.
Bonds are subject to interest rate risk and will decline in value as interest rates rise. Past performance does not guarantee future results. This performance report should not be construed as a recommendation to purchase or sell any particular securities held in composite accounts. Market conditions can vary widely over time and can result in a loss of portfolio value. The results portrayed included the reinvestment of dividends, interests, and other earnings. The index information presented herein does not reflect the impact of fees; you cannot invest directly in an index.
Monroe Bank and Trust has given permission to include their name. Their inclusion is not to be construed as approval or disapproval with respect to Community Capital Management and/or the investment advisory services provided.