The ETF ecosystem is always changing and growing. Thanks to the ETF’s flexibility, transparency, and tradability, it can help investors achieve plenty of bespoke goals. That even includes investing with an eye towards philanthropic causes as with philanthropic ETFs ASD and DUTY.
Key Takeaways:
- Philanthropic ETFs like DUTY and ASD, which launched this year, look to advocate for important causes while delivering for clients.
- The ETFs join existing funds like FLDZ and PINK, which also help causes — veterans and first responders, and cancer research, respectively.
- The funds’ use of the ETF wrapper, more tax efficient than mutual funds, has helped them deliver these strategies.
The U.S. Defense ETF (DUTY) donates 10% of its management fee revenue to U.S. veterans, while the Defiance Autism Impact ETF (ASD), which launched June 1, invests in firms focused on autism research and care.
See more: Inside ASD: The Story Behind the First Autism ETF
DUTY charges a 45 basis point (bps) fee to track a proprietary index of pure-play U.S. stocks tied to defense. The fund’s investments shall derive at least 50% of revenue from military systems, defense tech, logistics and mission support, and cybersecurity infrastructure.
That market cap-weighted index includes names like Palantir PLTR, which has benefitted from big contracts with the Trump administration The firm then takes 10% of its fee revenue and donates it to charities to bolster its claim to a place among other philanthropic ETFs.
ASD, meanwhile, will donate 100% of its profits to autism charities for two years following its launch. The strategy tracks an equal-weighted index of firms in developed markets that support individuals on the autism spectrum. Specifically, that includes firms across biotech, pharmaceuticals, healthcare, behavioral services, diagnostics, education and assistive tech. The ETF charges a 79-bps fee.
Those two philanthropic ETFs that launched this year join other funds with a philanthropic lean. The Simplify Healthcare ETF (PINK ) and the TrueShares RiverNorth Patriot ETF (FLDZ ) charge 51 and 70 bps, respectively.
PINK is a 100% pro bono fund where net profits are donated to the Susan G. Komen foundation. The ETF actively invests in 80 to 100 health care stocks, ranging across biotech, gene therapy, medtech, and more. It has returned 18% over the last three months.
FLDZ, meanwhile, donates the majority of advisory fees and all profits generated by management to Folds of Honor, a non-profit providing educational scholarships to spouses and children of fallen or disabled military service members and first responders.
Together, those four philanthropic ETFs embrace the ETF’s flexibility and offer some great tools for investors to act in the world around them. From veterans and their families, to cancer and autism research, the causes these ETFs support may intrigue.
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VettaFi LLC (“VettaFi”) is the index provider for ASD, for which it receives an index licensing fee. However, ASD is not issued, sponsored, endorsed, or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of ASD.
