From the March 2009 issue of Research Magazine • Subscribe!

Pax Pushes Social ETFs

Pax World Funds has filed a registration statement with the Securities and Exchange Commission to introduce three ETFs that follow a socially responsible investment strategy.

The proposed funds are the sShares KLD North America Sustainability Index ETF, sShares KLD Europe Asia Pacific Sustainability Index ETF and the sShares KLD FTSE Environmental Technologies Index ETF.

Funds with social themes typically select stocks based upon corporate governance, environmental and humanitarian factors.

The PowerShares Wilderhill Clean Energy Portfolio (PBW) has attracted $602 billion since launching in 2005 and is one of the most successful social ETFs. Other ETFs with social themes haven't been as fortunate.

Claymore Securities liquidated two social ETFs in 2008. Also, despite having roughly the same age as PBW, the iShares KLD Select Social Index Fund (KLD) has just $97.5 million in assets and the iShares KLD 400 Social Index Fund (DSI) has only $61.3 million.

In related news, an Oklahoma City-based firm called Veritas Funds is planning five ETFs targeted towards the values of various Christian denominations.

Pax World Funds oversees eight socially responsible mutual funds with close to $2 billion under management.

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Ron DeLegge is the San Diego-based editor of www.etfguide.com.

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