The Performance of Faith-Based Funds

19 Pages Posted: 15 Oct 2013

See all articles by John C. Adams

John C. Adams

University of Texas at Arlington

Parvez Ahmed

University of North Florida - Coggin College of Business

Date Written: December 20, 2012

Abstract

Mutual funds that invest in companies with products and policies consistent with the religious preference of their investors are often described as Faith Based Funds (FBF). The FBF, while having interesting differences, are essentially a subset of the more commonly known Socially Responsible Funds (SRF). While SRF screen investments primarily on secular social concerns, such as environmental or social, FBF scrutinize their investment choices to ensure that they satisfy the religious values of the faith groups that the funds serve. This paper compares the risk-adjusted performance FBF and SRF. In addition, the paper compares the risk-adjusted performance of SRF and FBF to the universe of U.S. mutual funds. Finally, the paper provides risk-adjusted performance measures for the two most common type of FBF – Christian and Islamic funds.

Keywords: Socially Responsible, Faith Based, mutual funds

JEL Classification: G11, G20

Suggested Citation

Adams, John C. and Ahmed, Parvez, The Performance of Faith-Based Funds (December 20, 2012). Journal of Investing, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2149637

John C. Adams

University of Texas at Arlington ( email )

Box 19449 UTA
Arlington, TX 76019
United States
904-476-2946 (Phone)

Parvez Ahmed (Contact Author)

University of North Florida - Coggin College of Business ( email )

4567 St. Johns Bluff Road, South
Jacksonville, FL 32224-2645
United States

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