Impact investing

AAA

DEFINITION of 'Impact investing'

Investing that aims to generate specific beneficial social or environmental effects in addition to financial gain. Impact investing is a subset of socially responsible investing, but while the definition of socially responsible investing encompasses avoidance of harm, impact investing actively seeks to make a positive impact – investing, for example, in non-profits that benefit the community or in clean technology enterprises.

INVESTOPEDIA EXPLAINS 'Impact investing'

Impact investing includes many different forms of capital and investment vehicles. The bulk of impact investing is done by institutional investors, but a range of socially conscious financial service companies, web-based investment platforms, and investor networks now offer individuals an opportunity to participate in it. One major venue is microfinance loans, which can provide small-business owners in emerging nations with startup or expansion capital. Women are often the beneficiaries of such loans. Impact investing need not always be profitable; investors often factor in social gains or goals.

 

RELATED TERMS
  1. Socially Responsible Investment ...

    An investment that is considered socially responsible because ...
  2. PT (Perseroan Terbatas)

    An acronym for Perseroan Terbatas, which is Limited Liability ...
  3. Ltd. (Limited)

    An abbreviation of "limited," Ltd. is a suffix that ...
  4. BHD (Berhad)

    The suffix Bhd. is an abbreviation of a Malay word "berhad," ...
  5. Promotional CD rate (Bonus CD rate)

    A limited-time offer of a higher rate of return on a certificate ...
  6. Direct Bidder

    An entity that purchases Treasury securities at auction for a ...
Related Articles
  1. Impact Investing: Making A Difference ...
    Investing News

    Impact Investing: Making A Difference ...

  2. What Are SRI Funds?
    Investing Basics

    What Are SRI Funds?

  3. Impact Investing: The Ethical Choice
    Markets

    Impact Investing: The Ethical Choice

  4. How AT&T Came To Serve A Third Of Americans
    Investing News

    How AT&T Came To Serve A Third Of Americans

comments powered by Disqus
Hot Definitions
  1. Effective Annual Interest Rate

    An investment's annual rate of interest when compounding occurs more often than once a year. Calculated as the following: ...
  2. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  3. Odious Debt

    Money borrowed by one country from another country and then misappropriated by national rulers. A nation's debt becomes odious ...
  4. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  5. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  6. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
Trading Center