A new lineup of exchange-traded funds (ETFs) proposes to follow the strict values of Catholics, Methodists and Christians.
The FaithShares Catholic Values Fund (NYSEArca: FCV), the FaithShares Methodist Values Fund (NYSEArca: FMV) and the FaithShares Christian Values Fund (NYSEArca: FOC) all began trading on the NYSE Arca this week.
The funds attempt to adhere to each denomination’s religious values by avoiding publicly traded stocks that profit from alcohol, gambling, pornography, tobacco, weaponry and other off-limit activities.
“We created these funds to meet the needs of investors who want to participate in the potential of the stock market, yet be good stewards of their money,” said Thompson S. Phillips Jr., President of FaithShares. “Each of our ETFs will include 100 stocks of large, well-known companies but specifically exclude those considered to be in ‘objectionable industries’ by a specific denomination.”
The FaithShares are the first ETFs to directly target the Christian marketplace and they charge 0.87% in annual expenses.
In July, the Javelin Dow Jones Islamic Market International Index Fund (NYSEArca: JVS) was the first socially responsible ETF with a religious theme to be unveiled. While the Islamic ETF has been slow to gather new investments (just $4.8 million in assets), it takes a similar approach as the FaithShares ETFs by avoiding investments not compatible with the certain religious beliefs.
FaithShares ETFs are benchmarked to custom indexes developed by FTSE and KLD Research & Analytics. The Oklahoma-based company anticipates launching ETFs that target the Baptist and Lutheran market.
In related new product news, the iShares 10+ Year Credit Bond Fund (NYSEArca: CLY) and the iShares 10+ Year Government/Credit Bond Fund (NYSEArca: GLJ) were also introduced.
CLY tracks the BofA Merrill Lynch 10+ Year US Corporate & Yankees Index, which is designed to measure the performance of the long-term, investment-grade U.S. corporate and Yankee bond markets. Component securities include debt issued publicly by U.S. corporations and U.S. dollar-denominated, publicly-issued debt of non-U.S. corporations, foreign government debt and supranational debt.
GLJ follows the BofA Merrill Lynch 10+ Year US Corporate & Government Index. It’s tied to the performance of the long-term, investment-grade U.S. corporate and government bond markets. Bonds inside the fund include publicly-issued U.S. Treasury debt, U.S. government agency debt, debt issued by U.S. and non-U.S. corporations, foreign government debt and supranational debt.
According to the prospectus, both funds have annual expense ratios of 0.20%.
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