Increasingly, people are choosing to put their money where their values are, and that sentiment isn't lost on money managers. Just this week, the first of three exchange-traded funds targeted at Christian investors hit the market. Two more will launch next week.
The securities held in each of the funds, FaithShares Catholic Values Fund , FaithShares Methodist Value Fund and FaithShares Christian Values Fund, are tailored to each denomination's teachings and recommendations for investing. FaithShares Advisors worked with the FTSE Group and KLD Research & Analytics, a provider of environmental, social and governance research and indexes, to create the series of custom indexes on which the funds are based.
Each fund has about 100 stocks, mostly household names like Microsoft (MSFT), Google (GOOG) and Starbucks (SBUX). What you won't find in them are companies that earn their profits from alcohol, tobacco, gambling, pornography or weapons -- the so-called "sin stocks." A secondary screening takes into account companies' social, environmental and governance practices.
Was it divine inspiration that lead to the creation of the FaithShares funds? "For the last 20 years, I've worked with faith-based organizations and foundations, and there always seemed to be a tug of war between them wanting to make money and doing so from objectionable industries," explains Thompson S. Phillips, Jr., president of FaithShares Advisors. "Garrett [CEO J. Garrett Stevens] came up with the brainstorm that ETFs would be a good platform to help them reach their goals."
Clearly there was demand. "People have strong convictions, and if they feel they can get a decent investment, they will take advantage of the opportunity," says Phillips. And so the first Christian-based ETF in the U.S. was born.
Source: Daily Finance | Sheryl Nance-Nash
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