Global X launches S&P 500 Catholic Values ETF

Apr 20th, 2016 | By | Category: Equities

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US-based exchange-traded fund provider Global X Funds has launched a new Catholic values-based ETF based on the S&P 500 Index. The Global X S&P 500 Catholic Values Index ETF (Nasdaq: CATH) will track the S&P 500 Catholic Values Index, which invests in US large cap companies whose business practices adhere to the Socially Responsible Investment Guidelines as outlined by the United States Conference of Catholic Bishops.

Global X launches S&P 500 Catholic Values ETF

The Global X S&P 500 Catholic Values Index ETF screens out S&P 500 companies whose operations are not aligned with Catholic values. 

The United States Conference of Catholic Bishops is a group of those who perform certain pastoral functions on behalf of the Christian faithful of the United States. The purpose of the Conference is to promote the greater good which the Church offers humankind.

The index’s methodology screens out companies with revenue exposure to operations that do not meet Catholic values by analysing each firm’s financial statements on a quarterly review basis. These activities include abortion, adult entertainment, biological and chemical weapons, contraception, nuclear weapons, stem cell activity, and the use of child labour. Those that survive the screening process are subsequently weighted according to their free float market capitalisation.

“Interest in indices that address ethical and sustainable issues have expanded from niche segments into mainstream investment strategies,” said Alka Banerjee, Managing Director of Product Management at S&P Dow Jones Indices. “The S&P 500 Catholic Values Index draws upon the widely recognized and prominent S&P 500 to provide the market with a transparent index that addresses a unique perspective and serves as the basis for Global X’s new ETF.”

“People are becoming increasingly interested in investing their assets in a manner that is consistent with their beliefs, thereby contributing to the well-being of the human family,” added Rev. Seamus P. Finn, OMI, a consultant for the application of Church’s Socially Responsible Investment Guidelines. “This fund could be a welcome option for members of the Catholic faith to consider.”

As of 31 March 2016, the index had 443 securities with major sector exposure to the information technology (20.9%), financials (15.3%), health care (14.0%), consumer discretionary (13.1%) and consumer staples (10.6%) sectors. The fund contains an all-in management fee of 0.29% due to a contractual fee waiver in place until March 2017. At that time, the total expense ratio may rise to 0.39%.

Jim Glownia, CFA, Regional Director at Global X, commented: “As an independent issuer of ETFs, Global X has the unique ability to help advisors and other investment professionals meet their clients’ investment needs. CATH is just one example of how we are able to execute an advisor’s investment thesis in a cost and tax-efficient wrapper.”

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