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.