ESG: An ESG ETF Including Oil Companies

2025-02-01 05:41:25 ET

Summary

• The FlexShares STOXX US ESG Select Index Fund holds 265 stocks of companies with an ESG score above their industry median.
• The methodology is quite permissive: in particular, it includes some oil companies.
• ESG has marginally outperformed the Russell 1000 since its inception in 2016, with similar risk metrics.
• ESG proves that adding ethical principles is not necessarily a drag on performance, but EFIV is more compelling in the ESG ETF category.

ESG strategy

The FlexShares STOXX US ESG Select Index Fund ETF (ESG) was launched on 07/13/2016 and tracks the STOXX USA ESG Select KPIs Index, based on an environmental, social, and corporate governance (“ESG”) investing approach. ESG has 265 holdings, a distribution yield of 1.40% and a net expense ratio of 0.32%. Distributions are paid quarterly....

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