Just in time for Pride Month, Wall Street has its first LGBTQ-focused ETF.
ProcureAM, in partnership with LGBTQ Loyalty Holdings, this week launched the new LGBTQ100 ESG ETF. This one-of-a-kind fund uses data from the LGBTQ community to identify the top 100 companies most aligned with the group’s environmental, social and corporate governance (ESG) goals. The fund includes names like Estee Lauder, Facebook, Starbucks, PayPal, Visa and more.
In an interview with CNBC’s “ETF Edge”, ETF Trends CEO Tom Lydon gave his take on the fund.
“You have a very strong group of defenders for this, for the right time, and I think these things are going to be essential and essential for what will happen in the future,” he said on Wednesday, pointing to the supporters. fund. such as former congressman Barney Frank and Martina Navratilova, a former professional tennis player and well-known transgender and gay rights advocate.
“People will be careful,” Lydon added. “I think there is going to be a lot of pull for that.”
The man behind the fund, Procure Holdings co-founder Bob Tull, shared his insider perspective on the fund in the same interview. He explained the unique approach used to select stocks within the fund, which sets it apart from traditional funds that only use quantitative analysis.
“The structure started with over a thousand titles, then the first thing we did was select them for inclusion and ESG using UN standards,” he said. “The community members are very loyal so there is a sentimental component to this clue.”
In the same ETF Edge interview, Andrew McOrmond, Managing Director of WallachBeth Capital, said it comes down to this new wave of investors. He says the new investor is younger and emphasizes the intersection between social governance goals and investing. These young people are also climbing the ranks in these large companies.
“If these companies do not support any exclusion and a diverse workplace, they will attract the best talent,” he said. “The best talent means the business is more successful.”
It’s a positive feedback loop. As young talents join companies that reinforce ESG values, these companies perform better and, as a result, their stock prices rise in the long run.
“I think that’s the underlying thing that’s going to drive this thing in the long run,” McOrmond said.