Florida-based investment company Timothy Plan has become the latest entrant to the US ETF market with the launch of two biblically responsible funds.
Investors seeking ETFs that are aligned with Christian values may also wish to consider the product suite from Inspire Investing.
The ETFs provide passive exposure to US large-cap equities with one of the funds focusing on stocks with high dividend yields. Both ETFs screen out firms that do not comply with Christian principles.
Each fund has been listed on NYSE Arca and comes with an expense ratio of 0.52%.
The Timothy Plan US Large Cap Core ETF (TPLC US) tracks the Victory US Large Cap Volatility Weighted BRI Index which has a starting universe of the 500 largest US stocks by market capitalization.
The methodology eliminates companies that do not satisfy the eVALUEator proprietary Biblically Responsible Investing screening criteria. According to the fund’s prospectus, this screening process eliminates firms with alcohol, tobacco, gambling, abortion, and pornography business activities as well as those involved, either directly or indirectly, in “promoting anti-family entertainment or alternative lifestyles”.
Remaining constituents are weighted by the inverse of their average price volatility over the past 180 trading days with sector weights capped at 25%.
The firm’s second launch is the Timothy Plan High Dividend Stock ETF (TPHD US) which is linked to the Victory US Large Cap High Dividend Volatility Weighted BRI Index.
Starting from the same universe of US large-cap stocks, the index applies the eVALUEator Biblically Responsible Investing screen and also removes firms that have not reported positive earnings in each of the four most recent quarters.
From the remaining pool of eligible securities, the methodology selects the 100 firms with the highest dividend yields and weights them by the inverse of their price volatility.
Both of the funds’ underlying indices reconstitute and rebalance on a semi-annual basis in April and October.
Investors seeking ETFs aligned with Christian principles may also wish to consider the suite of funds offered by Inspire Investing. Inspire currently has four ETFs which cover the US large-cap, US mid- and small-cap, global equity, and US corporate bond markets. The range houses approximately $400 million in assets under management with the largest fund being the $150m Inspire Global Hope ETF (BLES US).