Without getting into a debate on ethics and other factors, we have never been fans of any strategy that 'restricts' investor choices. We think fund managers should only invest in what they think will do well for their clients. It should be the client's decision on whether to look for narrower categories of investments. So, there is nothing 'wrong' with ESG investing, of course, but anything that limits an investable universe can limit returns as well. But, usually, socially responsible companies turn out to be good investments, anyway. But it is also a way to grab more fees from clients, by 'specializing'. Also, some of the ESG investments we've seen could be highly debatable on whether they qualify. Most ETFs are small. ZESG is $53M. We think ESGV, as one of the largest, would make the most sense, and we would be fine buying now for those interested in the category. It is up 18% this year but honestly its top holdings look like any other generic equity fund.
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