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Crossmark's ETFs: An Innovative Approach to Faith-Based Investing

Update Crossmark's Strategic Entry into the ETF Market Bob Doll, CEO and CIO of Crossmark Global Investments, has announced an ambitious new direction for his firm with the launch of its first exchange-traded funds (ETFs): the Crossmark Large Cap Growth ETF (CLCG) and the Crossmark Large Cap Value ETF (CLCV). This move marks Crossmark's commitment to capitalize on the growing allure of ETFs while incorporating their faith-based investment philosophy. Differentiation Through Values-Based Investing Unlike conventional ETFs, Crossmark's funds are designed with a clear set of ethical guidelines. Doll emphasized that roughly two-thirds of the firm’s managed assets are rooted in values-based investing. This approach not only filters out companies that produce harmful products, such as tobacco and adult content, but also aims to highlight those with beneficial social impacts. Companies with limited revenue contributions from objectionable activities, like Kroger with alcohol sales, may still qualify for inclusion based on broader criteria. Evaluating Potential Investment Candidates To curate their portfolios, Crossmark employs quantitative evaluations alongside values assessments, scoring potential investments on their managerial quality and growth potential. Doll claims this dual-pronged approach simultaneously considers traditional financial metrics and ethical standards, ensuring a more holistic selection process. “If both your financials and values score high, your chance of inclusion dramatically increases,” he explained. Future of Faith-Based ETFs: A Growing Niche The launch of these ETFs could signal a broader trend within the investment community, where sustainability and ethical considerations are becoming pivotal in client decisions. As more investors seek alignment between their financial goals and personal values, firms like Crossmark are well-positioned to capture this niche market. Analysts suggest this could catalyze other investment firms to explore similar pathways, thereby increasing the diversity of products available to investors. The Rising Interest in Ethical Investments With growing public scrutiny concerning investment impacts on society, the demand for faith-based and socially responsible investment options has never been higher. Crossmark’s strategy not only addresses this demand but also responds to a market eager for investment vehicles that reflect personal beliefs and values. By establishing itself in this segment, Crossmark could potentially drive substantial growth amid evolving investor priorities. Why Financial Planners Should Take Note The emergence of Crossmark’s ETFs presents new options for financial planners aiming to offer ethically-aligned investment products to their clients. As advisors increasingly navigate complex client values, integrating these faith-based options could enhance portfolio alignment with client identity. This shift also underscores the need for planners to stay informed about market developments in ethical and sustainable investing. As the investment landscape evolves, particularly in areas of faith-driven strategies, financial planners are encouraged to explore and understand these products. Engaging with clients on their values can foster deeper relationships and potentially increase client loyalty. Conclusion: The Importance of Aligning Investments with Values As Crossmark embarks on its ETF journey, it serves as a reminder of the importance of aligning financial planning with client values. By focusing on holistic investment strategies that underscore both performance and ethical considerations, financial professionals can better navigate the complexities of modern investing. To learn more about the implications of values-based investing and how it can enhance financial portfolios, consider increasing your expertise in this increasingly relevant area of financial planning.