Low Fees, Big Return From Aspiration Redwood

Fund Watch

This Socially Responsible Mutual Fund Offers Low Fees, Low Minimums, Big Returns

A young fund that practices socially responsible investing climbs the one-year chart.


When an unfamiliar name pops up as a top performer, we’ll often take a closer look. It turns out that the fund in question, Aspiration Redwood (symbol REDWX), features a couple of investor-friendly benefits. Despite a tiny asset base of $16 million, the fund’s annual expense ratio is just 0.50%. And it requires just $100 to start.

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Aspiration CEO Andrei Cherny says his firm is seeking to bring socially responsible investing to a wider audience. This power-to-the-people attitude explains the bite-size minimum, but what about the low fees? The fund’s costs are substantially greater than 0.50%, but for now Aspiration is capping the fees it charges shareholders at that level.

Bruno Bertocci and Thomas Digenan, of UBS Asset Management, run Redwood. To be considered, a firm must score high marks among its peers for its environmental, social and governance practices (one thing the fund looks for is diverse leadership). For the most part, the fund won’t invest in companies involved in fossil fuels, nor those in other blemished sectors, such as tobacco, alcohol and firearms. Beyond that, the managers seek firms with competitive advantages, talented executives and cheap share prices. The fund held 26 stocks at last word, with consumer-goods firm Newell Brands, drugmaker Eli Lilly and insurer Allstate holding the top slots.

@Only share class. Unless otherwise indicated, funds come in multiple share classes; we list the share class that is best suited for individual investors. rMaximum redemption fee. Source: Ⓒ Morningstar Inc.

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