On this episode of the “ETF of the Week” podcast, VettaFi’s Head of Research Todd Rosenbluth discussed the JLens 500 Jewish Advocacy U.S. ETF (TOV) with Chuck Jaffe of Money Life. The pair discussed several topics related to the fund to give investors a deeper understanding of the ETF overall.

Chuck Jaffe: One fund, on point for today. The expert to talk about it. Welcome to the ETF of the Week!

Yes, this is the ETF of the Week, where we examine trending, new, newsworthy, unique and intriguing exchange-traded funds with Todd Rosenbluth, the head of research at VettaFi. And at VettaFi.com, you’ll find all the tools you need to make yourself a savvier, smarter investor in exchange-traded funds.

Todd Rosenbluth, it’s great to chat with you again.

Todd Rosenbluth: It’s great to be back, Chuck.

Chuck Jaffe: Your ETF of the Week is…

Todd Rosenbluth: The JLens 500 Jewish Advocacy U.S. ETF. TOV.

Chuck Jaffe: TOV, as in Mazel tov, which would normally mean good luck. The tov is good. It’s the JLens 500 Jewish Advocacy U.S. ETF. And this is a really interesting pick, especially at this time when so much has been going on in the Middle East. Will disclose fully, you and I are members of the tribe, which is certainly interested in Jewish advocacy, but it doesn’t necessarily make us big fans of this fund, or at least for me, that’s the way I feel.

But how do you feel? Why this fund now? Is it because of the headlines, or is it because of the fund?

Todd Rosenbluth: So, it’s a combination of things. So, this is a fund, TOV, that launched earlier this year. It caught my eye when it did. It caught my eye again when it gathered over $100 million in assets. And then we’ve been doing some partnership in education about this fund, because of the environment that we’re in. And it’s just really an interesting strategy to me.

We talk a lot about ETFs where the goal is to outperform the broader market. That’s actually not the goal of TOV. The goal is for it to be representative of the broader U.S. equity marketplace. It has an index-based track record that goes back a period of time that shows it’s performing roughly in line with your broader U.S. equity strategies.

I’m sure we’ll talk about what is or is not inside the portfolio, but it’s intended to be quite similar. But the advocacy is what matters. And so, you know, as you mentioned, I’m Jewish, you’re Jewish as well. I know many people who want to be supportive of Jewish Americans, that want to be supportive of Israel, and this is an ETF that allows them to have a voice and a seat at the table.

And I think it’s worth taking a closer look at this ETF.

Chuck Jaffe: I think so as well. But it’s also important that people understand, you know, what’s happening when we get any sort of specialized fund. It doesn’t have to be this fund. It could be ESG funds, it could be funds that are tied to other religions, because there are funds tied to pretty much every religion out there.

You really want to know about execution. And this one is U.S. stocks, and it’s the advocacy side. Because this is not necessarily, “Let’s buy companies that we think are pro-Israel.” This is, “Let’s invest in companies where, because we own their shares, we get to vote their proxies and their proxies may at some point be facing things that would be pro-Israel or anti-Israel,” correct?

Todd Rosenbluth: 100% correct. And let me expand on that in a second. But yes, the fact that I’m Jewish and you’re Jewish is, it’s a fact. And so, that’s why we’re calling it out. There are funds that are supportive of other religions and follow the practices of other religions, and perhaps we’ll come and talk about that. I don’t have — I’m not against them. I’m not for them. They’re one of the 4000 plus ETFs that are out there.

This is not much of an exclusionary ETF. It holds almost all of the 500 largest companies that are in the United States. It excludes a handful of companies for reasons that are against Judaism.

And so, Philip Morris international is a stock that comes to mind that’s not included. But it’s the advocacy. So it’s a chance for, if you own this on your behalf, for the company that’s behind this, JLens, to advocate in support of pro- or push back against antisemitic practices that a company might have, or a vote or a bill or a proxy that’s up there that is anti-Israel, at least according to JLens.

And so that they can have a voice and a seat at the table. So, you need to own the stocks. You need to own Apple and Microsoft and Nvidia in order to have a seat at the table as to what’s happening at those companies from a proxy standpoint.

Chuck Jaffe: We should also point out, I mean, when you say it’s got most of the S&P 500, if you go in and you dig in to the the top 25 holdings, you know, the top ten holdings are the nine biggest companies in the Russell 1000 that is being reconstituted this week. They are the nine biggest companies in the S&P 500.

Then you have like, one that’s out of order or what have you, but very, very similar. That said, it’s not to say that somebody who’s running, you know, that iShares, when they run a Russell 1000 or SPDR, when you’re talking about the SPDR S&P 500 Trust, that those shares are voted anti-Israel or anti-Judaism. It is simply saying you want to make sure that your shares are voted with them.

And as a result, by the way that’s why — where a lot of funds that do some measure of religious screening or interest group screening have high expense ratios. The expense ratio on this is not out of line.

Todd Rosenbluth: No, the expense ratio is 18 basis points. Which again, if you’re affiliated with Judaism or you know people who are Jewish, 18 is a special number of chai. I don’t think it’s an accident that it’s 18 basis points. But that’s not a lot. It’s actually a cheaper fee than what we find for other, ESG-oriented ETFs, if I’m lumping this together, or advocacy oriented ETFs. This appeals to a subset of the audience, either investors that want to invest in a more Jewish manner and support Judaism or advisors that have those clients. But there’s also people who are pro-Israel, even if you’re not Jewish. And this is an ETF worth taking a closer look at.

Chuck Jaffe: One of the questions I ask you about virtually every ETF we discuss is how it mixes with your portfolio. Is it additive, et cetera. For anybody who’s out there, who’s got the S&P 500 or the Russell 1000 or some variation, or maybe just plain vanilla large-cap growth fund, this fund doesn’t add anything but the advocacy, correct?

Todd Rosenbluth: Correct. So I mean, if the reason to own this fund is a replacement to your large-cap core equity exposure where you get that advocacy. Your voice, your Jewish voice or your support of Judaism, is being heard. If you own this in complement with [the]Vanguard 500 ETF, VOO, which is the largest ETF, you’re paying a higher fee to own an almost identical portfolio.

That’s not a great effort. So, this is for people who always thought, I wonder if there’s a way to express my beliefs, my thoughts, and have my voice heard and own it in a diversified manner that’s appropriate, for me and for the long term goals. That’s the use case for this. And let me just be clear on something, even though I think the “U.S.” that’s in the name makes clear, this is not owning Israeli stocks.

There are ETFs to give you exposure to that from some of the other asset managers. This is U.S. companies that you’d expect to own within a broadly diversified portfolio. Just put through a lens, pun intended, that is favorable towards Judaism.

Chuck Jaffe: I’m going to ask a question that I don’t think has ever been asked in the history of ETF of the Week, which we’ve been doing for a long time. And that is when you consider the advocacy side. If you are strong, you want to be an advocate. Before this fund was out there, what you would have been doing is writing to your fund company and saying, I want to know how you vote your proxies, which you have a right to know, by the way, that is disclosed. You just have to figure out how to go find it and make a statement.

If you had to put on your advocacy hat, is that still the thing that makes the bigger statement? Because you know, not that you’re necessarily going to convince Vanguard to go, oh, we should vote this way, but just letting them know that shareholders are watching and doing that, doesn’t that maybe make them think about it in a way that this fund, even though it’s been able to gather together $100 million pretty quick. You know, $100 million is nothing when you’re talking about the Mag Seven and the other giant corporations.

So if somebody is an advocate, you can make a statement by owning this. But couldn’t you make a statement by writing to your fund company and saying, hey, you know, know we’re watching you?

Todd Rosenbluth: So, sure. You certainly could do so. But there is the power of being with a larger group, a larger entity that has the ability to get in front of executives to, to get in front of boards, as it accumulates scale. I’m trying to not use the word protest, but you going outside and protesting on your own? You’re one person.

You going to a protest where there are hundreds, or thousands, or tens of thousands of people that are there? Your collective voice is more likely to be heard than your individual voice. So, I think that for people who care about this, there’s an ETF for that. I feel like that’s a good way for us to have any of these conversations. There’s an ETF for that.

Chuck Jaffe: One more cool question about this, which is — I’m always asking you, you know, when does something fit in, et cetera. And there’s never a time when most investors would want to be completely out of the U.S. market, the largest companies, et cetera. So, you know, if this were an S&P 500, a Russell 1000, there would be times when you might say yes, you want to be more in or less in.

But in this case, because the fund is not just about what you own, it’s about the advocacy. And because you’re using U.S. stocks and not Israeli stocks, et cetera. Is this the kind of fund that if you buy it, you want to own it forever? For as long as you’re going to be an advocate, which for most people would be the rest of their lives, that your allocation to this is going to be static because you’re trying to make a statement?

And oh, by the way, it’s not about the Israeli market or whatever. It’s not about your feelings about the market. If you’re going to own the market and make the statement, then this is your fund and you ride it through everything?

Todd Rosenbluth: So yeah, I think that this is a strategic position for many people or those that own it. It’s a strategic position. I don’t see this as much of a tactical. And we might have — we certainly did last week. We’re going to have probably next week something that’s a bit more tactical, given the environment that we’re in.

This TOV feels like a strategic position for a subset of investors.

Chuck Jaffe: And if you are one of those investors, you might want to check out the JLens 500 Jewish Advocacy U.S. ETF, ticker TOV. And yeah, it’s the ETF for the Week from Todd Rosenbluth, head of research at VettaFi. Todd, Mazel tov. Always great to chat with you. Safe travels. We’ll talk to you again next week!

Todd Rosenbluth: Lechaim!

Chuck Jaffe: The ETF of the Week is a joint production of VettaFi and Money Life with Chuck Jaffe. And yeah, I’m Chuck Jaffe. You can learn all about my hourlong weekday podcast by going to MoneyLifeShow.com, or by searching on your favorite podcast app. And if you’re searching for more information on what could be your next favorite ETF, or maybe it’s the favorite one you got now, go to VettaFi.com where they’ve got a full suite of tools that’s going to help you out.

They’re on Twitter at @Vetta_Fi, and Todd Rosenbluth, their head of research, my guest, he’s on X as well. He’s at @ToddRosenbluth.

The ETF of the Week is here for you every Thursday. Make sure you don’t miss an episode by following along on your favorite podcast app. And we’ll be back with another intriguing ETF for you to consider next week.

Until then, happy investing everybody!

For more news, information, and analysis, visit the Faith-Based Investing Channel.

Third-Party Posts on Social Media

Third-party posts that appear on this social media site have not been reviewed or approved by JLens or its representatives for completeness or accuracy. Additionally, it should be noted that the information that has been posted by third parties does not necessarily reflect the views or opinions of JLens or its representatives.

VettaFi.com is owned by VettaFi LLC (“VettaFi”). VettaFi is the index provider for TOV, for which it receives an index licensing fee. However, TOV is not issued, sponsored, endorsed, or sold by VettaFi. VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of TOV.