Robin Lacey, managing director, TD Asset Management, said in a press release: “The TDAM Global Sustainability Fund offers an innovative combination of companies recognized for their leading approach to building sustainable businesses, as well as companies that are developing interesting solutions for today’s pressing environmental problems.”
The fund seeks to achieve long-term capital appreciation by investing primarily in equity securities of companies from around the globe viewed as contributing to the world’s future sustainability, according to the release. These companies are selected from the Dow Jones Sustainability World Index SM (DJSI World), which consists of approximately the top 10% of companies in terms of sustainability, out of the largest 2,500 companies worldwide by free-flow market capitalization.
The index is based on the comprehensive sustainability assessment by SAM, the Zurich-based sustainability investing specialist, and thus reflects an integrated analysis of economic, environmental and social criteria focused on long-term shareholder value.
“In addition, a portion of the portfolio will be dedicated to emerging specialists in environmental technology,” said Thomas George, Vice President and Director, Portfolio Management, TD Asset Management, in the press release.
A Morningstar news release said Ohio’s direct-sold CollegeAdvantage plan was named as one of the country’s best while its Putnam CollegeAdvantage was listed as one of the worst.
CollegeAdvantage got its kudos because of its “sensible” age-based options, active and index strategies, low fees, and “generous” tax deductions for in-state residents, according to the release. Because the state of Ohio manages CollegeAdvantage, it has the flexibility to create a lineup of offerings from numerous fund families, Morningstar said.
The Putnam CollegeAdvantage appeared on the Worst list for the second year in a row. Morningstar commented: “Despite lowering fees and adding non-Putnam funds to its lineup during the past year, it still relies heavily on Putnam funds, which have been hampered for several years by high manager and executive turnover and poor performance.”
“2008 was a terrible year for 529 plan investors,” said Greg Brown, Morningstar mutual fund analyst and author of the study, in the release. “In recent years, the industry made strides by lowering fees, improving investment options, and closing down poorly structured plans. Last year, however, we saw too many plans that were overly aggressive with their investment strategies as students approached college, and plans that stayed loyal to strategies that just weren’t working.”
Kudos to Virginia
Also at the top of the list were Virginia’s two plans, Education Savings Trust and CollegeAmerica, which earned Morningstar’s accolades two years in a row.
“Virginia Education Savings Trust is managed by the state of Virginia, rather than a fund company, which gives the plan the freedom to choose among different fund families,” Morningstar said. “The fund also offers a mix of index and actively managed age-based portfolios, as well as healthy state tax breaks and low costs. Virginia CollegeAmerica returns to the Best list with its lineup of high-quality American Fund funds with broad asset class exposure and low fees.”
Further, Morningstar said, its “longtime favorite” Utah Educational Savings Plan Trust returns to the Best list for its low costs, strong lineup of Vanguard Group index funds, and the flexibility offered by five age-based options. Indiana CollegeChoice 529 Direct Savings Plan debuts on the Best list with strong underlying funds, broad asset class exposure, prudent age-based portfolios, and customization options.
At the other end, Morningstar said two Nebraska 529 plans appear on the Worst list this year. Nebraska AIM College Savings Plan makes its fourth appearance in a row as a result of its high fees and lack of fund options. Nebraska State Farm College Savings Plan joins the Worst list not only because plan administrators chose precisely the wrong time to invest heavily in Oppenheimer bond funds, but also because the state still hasn’t done anything to address the problem (see “College Savings Plans Hit Hard by Oppenheimer Fund Loss“).
The Lists
Best 529 College Savings Plans (name, program manager):