Christians who want to align their investments with biblical values can now look to two new Inspire Investing exchange traded funds to track global companies that provide a positive impact on the world through various environmental, social and governance principles.
Inspire Investing launched the Inspire Global Hope Large Cap ETF (NYSEArca: BLES) and Inspire Small/Mid Cap Impact ETF (NYSEArca: ISMD). BLES and ISMD come with a 0.65% expense ratio.
“At Inspire, we’re dedicated to having a meaningful influence in the lives of people all over the world through investing in inspiring companies, engaging with firms to encourage alignment with positive business practices, and giving generously from our corporate profits,” Robert Netzly, President and CEO of Inspire Investing, said in a note. “Good values and good returns are not mutually exclusive. Inspire ETFs allow you to join the growing movement of impact investors supporting worthy causes while maintaining the potential for above average investment returns.”
The large-cap ETF tries to reflect the performance of the Inspire Global Hope Large Cap Index, which is comprised of emerging and developed market large-cap stocks taken from the Russell 1000 Index, MSCI EAFE Index and MSCI Emerging Markets Index, depending on the Inspire Impact Score, a proprietary selection process designed to score a particular security based on the company’s alignment with biblical values and positive impact that the company has on the world through various ESG criteria. The index is made up of about 50% domestic, 40% developed foreign and 10% emerging market.
The small- and mid-cap ETF selects domestic small- and mid-cap stocks from the Russell 2,000 and the S&P 400 based on the Inspire Impact Score, with an even 50% tilt toward small-caps and 50% to mid-caps.
The biblical values component screens and removes companies that have any degree of participation in activities involved with abortion, gambling, alcohol, pornography, the LGBT lifestyle and rights violations, such as association with or doing business in terrorist sponsoring countries, countries with oppressive systems of government, and countries where there are known human rights violations related to the persecution or sever discrimination against Christians, along with poor labor practices, according to the prospectus.
Positive scores are assigned to companies involved in the activities that align with biblical values, including curing or treating disease; enhancing educational opportunities; providing food, water, shelter, clothing and sanitation for the poor and marginalized; providing Christian-themed products or services; encouraging more time with family; providing above average compensation when compared to industry peers; providing above average employee benefit packages when compared to industry peers; providing a safe and healthy workplace environment) benefit the communities in which they do business through philanthropy and volunteerism); and protect and preserve the environment.
The underlying index would utilize software to analyze publicly available data relating to business activities, products and services, philanthropy, legal activities, policies and practices when assigning Inspire Impact Scores, selecting companies with the highest Inspire Impact Score and equally weighting the components.
The biblical values investment theme may help enhance returns. According to a recent study conducted by Biola University’s Inspire Institute, researchers found that applying the Inspire Impact Score methodology of a security selection process can achieve above-average investment results when compared to non-screened benchmarks.
“Biola University’s recent study proves that it was possible to invest responsibly with biblical values and potentially earn above average returns. Evangelical Christians control approximately $13.7 trillion of the assets in the U.S. and our hope is that this data will encourage more of those assets to get involved in impact investing so we can all share a brighter future together,” Netzly added.
For more information on new fund products, visit our new ETFs category.