Green Fund

A green fund is a collective investment venture that will only fund and support businesses that encourage, or are involved in, "green" interests. In order to gain the investment of a green fund, the company must be environmentally friendly in all of its business practices. Businesses that also actively support green interests, such as energy conservation, waste management, alternative energy research, and other environmentally conscious programs, are likely to gain the support of this type of mutual fund.

These groups of investors may also decide to avoid businesses that are not socially aware in their business practices, and may have certain negative criteria that will prevent them from investing in a particular type of company. For example, the fund may avoid investing in alcohol, tobacco or gun manufacturers. This type of mutual fund is considered to be a part of a growing market trend called socially conscious investing.