Domini 400 Social Index

AAA

DEFINITION of 'Domini 400 Social Index'

A market cap weighted stock index of 400 publicly traded companies that have met certain standards of social and environmental excellence. Potential candidates for this index will have positive records on issues such as employee and human relations, product safety, environmental safety, and corporate governance. Companies engaged in the business of alcohol, tobacco, firearms, gambling, nuclear power and military weapons are automatically excluded.

This relatively new index was designed to help socially conscious investors weigh social and environmental factors in their investment choices.

INVESTOPEDIA EXPLAINS 'Domini 400 Social Index'

Socially conscious investing is a growing trend across many demographic and geographic areas, and having a social conscience may become a competitive advantage for corporations through their relationships with shareholders.

The index is independently maintained by research firm KLD Research & Analytics, and aims to be comprised of chiefly large cap stocks in the S&P 500; the ranges break down as follows:

1. Approximately 250 companies in the S&P 500
2. 100 companies not in the S&P 500, but providing sector diversification and exceeding pre-determined market cap limitations
3. 50 companies that have shown excellence in their social and environmental dealings

RELATED TERMS
  1. Sin Stock

    A stock of a company that is either involved in or associated ...
  2. Group Of 30 - G30

    A consultive group composed of academics and financiers whose ...
  3. Group Of 24 - G-24

    Twenty-four countries established in 1971 to work together to ...
  4. Social Responsibility

    The idea that companies should embrace its social responsibilities ...
  5. Market Index

    An aggregate value produced by combining several stocks or other ...
  6. Socially Responsible Investment ...

    An investment that is considered socially responsible because ...
RELATED FAQS
  1. Is it possible to invest in an index?

    First, let's review the definition of an index. An index is essentially an imaginary portfolio of securities representing ... Read Full Answer >>
  2. What is a "socially responsible" mutual fund?

    As the name suggests, socially responsible mutual funds invest exclusively in socially responsible investments. Securities ... Read Full Answer >>
Related Articles
  1. Investing Basics

    An Introduction To Stock Market Indexes

    Investopedia explains the five most talked about indexes and what makes them all different.
  2. Investing Basics

    Sinful Investing: Is It For You?

    Sin stocks may seen outright undesirable to some, but these "naughty" industries bring stable returns - even in hard times.
  3. Mutual Funds & ETFs

    Socially (Ir)responsible Mutual Funds

    Not concerned about being an ethical investor? Maybe "sinful stocks" have a place in your portfolio.
  4. Mutual Funds & ETFs

    Socially Responsible Mutual Funds

    It is possible to avoid unethical investments and still profit from mutual funds. Find out how!
  5. Mutual Funds & ETFs

    Socially Responsible Stocks: Do Good Deeds Punish Profits?

    Socially responsible investing doesn't mean accepting lower returns. Find out why squeaky-clean stocks shine as investments.
  6. Economics

    Mitigation Trade: Making Up For Environmental Harm

    Mitigation banking is a system by means of which the liability of ecological damage is transferred from the permittee to the mitigation banker through a system of credits and debits under regulatory ...
  7. Chart Advisor

    Time To Rebalance? These ETFs Say So

    Caution ahead: 2014 has been very good to U.S. large-cap indexes, but lagging commodities and funds holding mid- to small-caps point to a slowdown.
  8. Mutual Funds & ETFs

    Will Stock Market VOOdo Continue?

    The Vanguard S&P 500 ETF (VOO) offers a relatively safe investment opportunity for people who aren't sure which way the market is headed.
  9. Home & Auto

    5 Investment Risks Created By Global Warming

    Climate-change deniers and believers alike would be wise to prepare for the worst.
  10. Investing

    Market Cap

    Learn more about how market cap represents the "price tag" of a company.

You May Also Like

Hot Definitions
  1. Income Effect

    In the context of economic theory, the income effect is the change in an individual's or economy's income and how that change ...
  2. Price-To-Sales Ratio - PSR

    A valuation ratio that compares a company’s stock price to its revenues. The price-to-sales ratio is an indicator of the ...
  3. Hurdle Rate

    The minimum rate of return on a project or investment required by a manager or investor. In order to compensate for risk, ...
  4. Market Value

    The price an asset would fetch in the marketplace. Market value is also commonly used to refer to the market capitalization ...
  5. Preference Shares

    Company stock with dividends that are paid to shareholders before common stock dividends are paid out. In the event of a ...
  6. Accrued Interest

    1. A term used to describe an accrual accounting method when interest that is either payable or receivable has been recognized, ...
Trading Center