- ESG-themed ETFs and ETPs have amassed a record $130B in net inflows worldwide year to date -- 49% greater than their total inflows for all of 2020, new data from market tracker ETFGI shows.
- The consulting firm found that ESG funds garnered $11.25B of inflows worldwide during October. That brought the sector's total inflows to $130.28B YTD, which is more than $75B the market witnessed at this time last year. In 2020 at this point, market participants experienced $54.91B in capital inflows.
- ESG funds follow environmental, social, and governance standards which have become popular with sustainability investors.
- Three of the U.S. market's prominent ESG ETFs are the SPDR S&P 500 ESG ETF (NYSEARCA:EFIV), iShares ESG MSCI USA ETF (NASDAQ:ESGU), and the Vanguard ESG U.S. Stock ETF (BATS:ESGV).
- Here's a look at all three:
SPDR S&P 500 ESG ETF (EFIV)
- EFIV is designed to track S&P 500 firms that meet specific sustainability or ESG standards while maintaining overall industry weighting similar to that of the S&P 500.
- EFIV has $361.8M AUM, 315 holdings and comes with a 0.10% expense ratio.
- From a return vantagepoint, EFIV has outperformed the benchmark SPDR S&P 500 Trust ETF (NYSEARCA:SPY) year to date, up 28.2% while SPY is +25.1%.
iShares ESG MSCI USA ETF (ESGU)
- ESGU offers exposure to large- and mid-cap U.S. stocks with favorable ESG scores. The ETF aims to track the MSCI USA Index, but with a more sustainable outcome.
- The ETF is a heavyweight among ESG funds when it comes to assets under management. The fund has $23.9B under its belt, with 344 total holdings and a 0.15% expense ratio.
- From a return standpoint, ESGU is +24.2% YTD, just shy of the benchmark SPY's +25.1%.
Vanguard ESG U.S. Stock ETF (ESGV)
- This ETF aims to track the FTSE US All Cap Choice Index, proving exposure to large-, mid- and small-cap stocks that have been screened for ESG criteria.
- ESGV holds $5.8B AUM across 1,548 holdings, with a 0.12% expense ratio.
- But like ESGU, ESGV comes up short compared to the SPDR S&P 500 Trust ETF (SPY). The fund is +24.3% YTD vs. 25.1% for SPY.
Greater Insight
- For a greater insight into the ESG marketplace, tune into Seeking Alpha's Let's Talk ETFs podcast for an interview with Ari Polychronopoulos, partner/product management and head of ESG at Research Affiliates.