Socially conscious investors can also adopt investment habits that reflect their own social views by picking through focused exchange traded funds that combine their beliefs with an investment objective through strategies that focus on environmental, social and governance or ESG principles.

“What it is really about is companies that adhere to certain principles, whether it be supporting the environment, supporting things like gender equality, or just human rights in general – things that we think are important but not always do we associate with corporations,” Richard Cea, Head of Insight Shares at UBS, said at the Charles Schwab IMPACT 2018 conference.

The New Breed

For example, the InsightShares LGBT Employment Equality ETF (NYSEArca: PRID) is among a new breed of socially responsible investments. Specifically, PRID includes large- and mid-capitalization U.S. stocks of companies with workplaces that promote and provide equality for lesbian, gay, bisexual and transgender, or LGBT, employees based on their score in the Human Rights Campaign Foundation’s Corporate Equality Index.

Component companies included in the index will be rated on how the company’s policies address non-discrimination against employees based on sexual orientation or gender identity; the extent to which the company provides equitable benefits to LGBT workers and their families; the measures the company takes to provide internal education and maintain accountability metrics to promote LGBT inclusion competency; and whether a company has made a public commitment to the LGBT community.

UBS has also added another cause-focused product, the InsightShares Patriotic Employers ETF (NYSEArca: HONR), which is comprised of large- and mid-capitalization U.S. stocks of companies with policies and practices determined to be Military Friendly. HONR allows investors to do good and do well at the same time by supporting veterans who have sacrificed so much for our freedom and investing in a product that offers attractive potential returns.

As a way to better filter and screen for companies that have a great job in adequately incorporating veteran skills into their business, VIQTORY has developed the so-called Military Friendly Ratings, which is backed by more than 16 years of data that identified companies who are doing the best job of providing opportunities to our country’s veterans.

For more market-related commentary from Tom Lydon and other industry experts, visit our ETF Trends video category.

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