Seems there is now an exchange-traded fund for just about everything, including vegans! Jersey-based Beyond Advisors IC has announcing the world’s first US Vegan Climate ETF. The ETF will begin trading with the ticker VEGN on the New York Stock Exchange on September 10th, proof that this year is truly the Year of The Vegan.
According to the prospectus for the US Vegan Climate ETF, it aims to attract investors who are concerned about the environment, animal cruelty, and addresses concerns of the plant-based community. An exchange-traded fund, or ETF, aims to offer low-cost access to a wide portfolio of stocks and are usually connected together because of a common trend or theme. Put simply, it can be seen as a basket of stocks and securities.
Of the growing pool of socially responsible funds, the US Vegan Climate ETF is the first of its kind in the world that places stringent standards to exclude any stocks from the US S&P 500 whose activities are incompatible with a vegan and climate-conscious investment approach. In other words, the fund avoids investing in companies whose businesses rely on animal derived products, animal testing, fossil fuel use and plastic and agrochemical use.
Commenting on the anticipated launch, CEO of Beyond Investing Claire Smith said: “So many compassionate people go to great efforts to avoid buying products that contain animal ingredients…but when it comes to their investment options, they’re actively, albeit unwittingly, supporting companies that exploit and torture animals.”
The ETF will offer investors the opportunity to spend their money in line with their values, whether it be from an ethical standpoint or environmental perspective. Compared to the S&P 500, the Vegan Climate Index leaves a much smaller footprint with 61% less carbon emissions, 89% less waste and 83% less water usage.
As with often the case to alternatives to conventional services, investors will have to pay a premium for their investment in the world’s first vegan ETF. It will be available to investors for an expense ratio of 0.60%, which is slightly higher than most socially responsible funds that sit at around 0.4 – 0.44%, according to data from ETF.com. But while it is costlier than other responsible options, the fee represents the research gone into constructing the strict rules when building the fund.
“We’re building the index in a robust fashion and providing impact metrics, which demonstrate its social and environmental benefits,” explained Smith.
The launch of the US Vegan Climate ETF is reflects the change in consumer and investor patterns. Business leaders and investors, now all out of choices, are increasingly pricing in climate change in their strategies and adopting a long-termism approach. Millennials and Gen Z consumers are also increasingly looking towards mission-driven businesses, and no longer wish to compromise their values when investing individually. This explains the rising trend of responsible investment, and with around 75 socially responsible ETFs already available on the market, it looks like this trend is not going anywhere.
Lead image courtesy of PxHere.