With pride month currently underway, there’s no time like the present to learn more about the world’s first LGBTQ ETF, the LGBTQ + ESG100 ETF (NASDAQ: LGBT). CNBC’s Seema Mody filled in as host on “ETF Edge” to discuss LGBT and its holdings with Tom Lydon, ETF Trends CEO, Bob Tull of Procure Holdings, and Andrew McOrmond, managing director of Wallachbeth Capital.
LGBT is one of the first funds designed to serve the principles and values of the LGBTQ community and its allies. The fund provides investors with the methodology and results related to the performance of the top corporations that embrace ESG principles and advance equality in the workplace.
Additionally, LGBT offers investors access to U.S. large cap equity securities of companies that have demonstrated a commitment to LGBTQ diversity and inclusion, along with ESG compliance, as part of their corporate social responsibility fundamental mandates.
The ESG Factor
Lydon notes how the ETF has arrived at the right time, with great people and advocates standing behind it. Spokesperson Martina Navratilova promoting these values in the corporate community means people will pay more attention.
For Tull, who created and launched the fund, the timing was key, but the other crucial element is the members of the community. There’s much loyalty there, which applies to the sediment composition of the LGBTQ100 ESG Index (LGBTQ100). This index identifies the top 100 corporations that most-align with the LGBTQ community across America.
McOrmond speaks to the young talent being that will drive the fund and ESG into the long-term future. As has been made clear, millennials fueled the growth of sustainable investing throughout the 2010s, contributing $51.1 billion to sustainable funds in 2020, compared to less than $5 billion five years ago. Additionally, concerns over climate change have been a huge driver of growth.
Other aspects of ESG include the support for inclusion, which falls under the social area. As a result, top talent will be more attracted to the companies holding onto this ideal.
“That’s really the kind of hidden thing in here that’s going to drive better performance,” McOrmond adds.