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Katherine: Can you explain what the impact shares the NAACP minority empowerment ETF is?

Ethan: I can, Katherine, it is kind of a mouthful, but uh, it's important to include all of those organizations because it's an ESG fund. But the premise is that with generic ESG strategies where we have at corporate citizenship score of a plus versus a B minus and it factors in 500 different metrics and very well-intended asset managers are sort of figuring out who a good corporate citizen is. You lose a lot in the communication within the investor base and people are really trying to reconcile their system of beliefs back to some of these ESG strategies. And by including the NAACP, really what we're asking is what does a good corporate citizen look like through the lens of the NAACP, specifically, as it relates to minority empowerment here in the U.S. So it's very targeted, it's a single social issue, equity market proxy. So you still get your broad equity market exposure, but you know exactly what your capital is going towards improving society in which direction we're steering society.

Katherine: As I said, it's been a year. So how's it going so far?

Ethan: It's going great. Um, you know, our performance over the trailing 12 months is a little over 10.2, which the categories return 7.7. That's the Morningstar large blend domestic category. So from a financial perspective, we're actually ahead of where we would have thought. Again, we're trying to just have broad equity market exposure. We beat our category, we're in the top core tile of our category, which includes actively managed funds as well. Um, we received a five globe rating for Morningstar, which puts us in the fourth percentile relative to broad ESG standards. Um, and you know, we've received some industry awards, most innovative ETF issuer, um, best new ESG funds. So, so far so good.

Katherine: So I got to say, based off of that, it sounds like if I'm a millennial and I'm looking to invest sustainably or investing in matters that matter to me, that this is a good way to go cause it's gonna profit me in the long-term.

Ethan: Well that's exactly right. So, so if you can both generate a competitive return and be very intentional with the social implications of your capital allocation, it's really a win win. Right. And, um, you know, we, we say intentional because the goal of impact shares is to have every social issue reflected with a separately invested or investible fund that represents a collaboration with a leading social advocacy firm. So what that lets your listeners do is to create bespoke, socially responsible investment portfolios that are reflective of their personal social priorities, not some arbitrary idea of a good corporate citizen.

Curious about getting involved in socially-conscious investing?

It's the one-year anniversary of Impact Shares NAACP Minority Empowerment ETF (NACP) .

Looking back, how has the ETF performed?

According to Powell, "for the one year ending July 12, NACP has returned 10.21%, which compares to 7.76% for the average Large Blend Mutual Fund and ETF in the United States. Large Blend represents the peer group as assigned by Morningstar. This ranks the fund in the 25% percentile."

First and foremost, however, what in the world do all of those words mean together?

"It is kind of a mouthful, but it's important to include all of those organizations because it's an ESG fund. But the premise is that with generic ESG strategies where we have a corporate citizenship score of A plus versus a B minus and it factors in 500 different metrics and very well-intended asset managers are sort of figuring out who a good corporate citizen is. You lose a lot in the communication within the investor base and people are really trying to reconcile their system of beliefs back to some of these ESG strategies. And by including the NAACP, really what we're asking is what does a good corporate citizen look like through the lens of the NAACP, specifically, as it relates to minority empowerment here in the U.S. So it's very targeted, it's a single social issue, equity market proxy. So you still get your broad equity market exposure, but you know exactly what your capital is going towards improving society in which direction we're steering society," explained Powell.

But why should investors consider an ETF like this? Here's how the ETF has done over the past year. 

"You know, our performance over the trailing 12 months is a little over 10.2, which the categories return 7.7. That's the Morningstar large blend domestic category. So from a financial perspective, we're actually ahead of where we would have thought. Again, we're trying to just have broad equity market exposure. We beat our category, we're in the top core tile of our category, which includes actively managed funds as well. We received a five globe rating for Morningstar, which puts us in the fourth percentile relative to broad ESG standards," he explained. 

What Is an ESG ETF?