ETFdb Logo
  • ETF Database
  • Channels
    • Themes
      • Active ETF
      • Alternatives Channel
      • Artificial Intelligence
      • China Insights
      • Climate Insights
      • Core Strategies
      • Crypto
      • Disruptive Technology
      • Energy Infrastructure
      • ETF Building Blocks
      • ETF Education
      • ETF Investing
      • ETF Strategist
      • Faith-Based Investing
      • Financial Literacy
      • Fixed Income
      • Free Cash Flow
      • Innovative ETFs
      • Invest Beyond Cash
      • Leveraged & Inverse
      • Modern Alpha
      • Portfolio Strategies
      • Tax Efficient Income
    • Asset Class
      • Equity
        • U.S. Equity
        • Int'l Developed
        • Emerging Market Equities
      • Alternatives
        • Gold/Silver/Critical Materials
        • Crypytocurrency
        • Currency
        • Volatility
      • Fixed Income
        • Investment Grade Corporates
        • US Treasuries & TIPS
        • High Yield Corporates
        • Int'l Fixed Income
    • ETF Ecosystem
    • ETFs in Canada
    • Market Outlook
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Database Categories
    • Indexes
    • Scenario Analysis
    • Watchlists
    • Head-To-Head ETF Comparison Tool
    • Mutual Fund To ETF Converter
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
  • Research
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF of the Week Podcast
    • Gaining Perspective Podcast
    • ETF Prime Podcast
    • Video
  • Company
    • About VettaFi
    • Get VettaFi’ed
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. The Responsible Investing Channel
  2. There Could Be Surprising Value in SHE ETF
The Responsible Investing Channel
Share

There Could Be Surprising Value in SHE ETF

Tom LydonJul 25, 2022
2022-07-25

Environmental, social, and governance (ESG) exchange traded funds often tilt heavily toward growth stocks — a trait that’s exposing investors to subpar returns this year as growth stocks retreat.

However, with the proper level of due diligence, investors can identify ESG funds with surprising value traits. Arguably, the SPDR SSGA Gender Diversity Index ETF (SHE B-) is one such example. As its name implies, SHE isn’t an ESG ETF in the strictest sense of the term. Rather, SHE is a marquee member of the growing cohort of funds providing exposure to gender lens investing.

Owing to the point that it’s not a run-of-the-mill ESG fund, SHE, although it’s passively managed, isn’t as growth-heavy as old guard counterparts. That’s a clear advantage at a time when value stocks are back in style.

“Value stocks have a history of outperforming their growth counterparts in times of rising rates and inflation,” according to BlackRock research. “This is because the cash flows of value companies are front-end loaded. Growth stocks, in contrast, are considered longer-duration assets with expectations of greater cash flows further into the future. These farther-off cash flows get discounted by higher rates, giving value stocks an upper hand in an inflating environment.”

Indeed, SHE isn’t a pure value ETF. The fund allocates about 49% of its weight to technology, consumer discretionary, and communication services stocks. Those are growth sectors, and struggling ones at that.

However, SHE is sector agnostic. The fund aims to provide exposure to companies with superior gender diversity relative to others in their respective sectors, meaning it’s possible that over time, the fund’s sector exposures can shift to include deeper value or growth tilts.

As things stand today, SHE allocates about 28% of its weight to healthcare and financial services stocks — two prime value destinations. That’s an overweight of 300 basis points to those groups relative to the S&P 500, confirming SHE has some credibility as a value idea and that’s meaningful as interest rates are likely to continue rising.

“In a BlackRock Fundamental Equities analysis of growth versus value stocks using data since 1927, we found value had achieved greatest outperformance in periods of moderate to high inflation. It was only when inflation was very low that value performance paled. Value stocks have also tended to perform well amid rising interest rates. Over the past 40 years, a sizable portion of value returns has come during periods of rising rates,” concluded the asset manager.

For more news, information, and strategy, visit the ESG Channel.

Loading Articles...
Our Sites
  • VettaFi
  • Advisor Perspectives
  • ETF Trends
Tools
  • ETF Screener
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Database Pro
More Tools
  • Financial Advisor & RIA Center
Explore ETFs
  • ETF News
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Information
  • Contact Us
  • Terms of Use and Privacy Policy
  • © 2025 VettaFi LLC. All rights reserved.

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X