Impact Investing

Response to the Proliferation of ESG ETF’s ($NEXTX)

October 21, 2021

Article

https://www.barrons.com/articles/green-stock-fund-moderna-tesla-ibm-51632255178?refsec=sustainable-investing

This Fund Is Winning Big by Betting on Stocks That Help Humanity

Lewis Braham

Sept. 22, 2021

RESPONSE

The fund (NEXTX) is reactionary in the sense that it is not creating the public benefit that the companies have created, but investing after the public benefit has been created and riding the success. I understand that this is not an early stage impact VC fund, but it is important to analyze the contribution of this fund to the public benefit.

There seems to be a proliferation of ETFs that track innovative technology companies. If one subscribes to the belief that our world needs systemic change, it is positive sign to see bets being made on innovative companies.

It seems the fund is using a best-in-class methodology. They pick out stocks in various sectors and search for the stock that is outperforming the incumbents in a sustainable way.

Lastly, I thought the fund manager’s thesis of looking for companies that reduce “long-term risks to humanity” was interesting. I suppose each of his positions must be long positions. 

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