Trump-Backed ETF Excludes 37 Companies with DEI Policies

A new ETF, Azoria 500 Meritocracy ETF, will exclude 37 S&P 500 companies that engage in diversity, equity and inclusion (DEI) practices, mirroring the S&P 500 but without DEI. The ETF's creator, James Fishback, believes that companies that hire based on merit rather than race and gender will perform better in the next couple of years. While some investors may be drawn to the ETF's narrative, experts warn against separating politics and investing, and note that ideologically driven ETFs tend to charge high fees and attract limited investment.

In a move that reflects a shift in investment strategy, Azoria Partners has announced the launch of the Azoria 500 Meritocracy ETF, a new Exchange-Traded Fund (ETF) that excludes 37 S&P 500 companies that engage in diversity, equity, and inclusion (DEI) practices. The ETF's creator, James Fishback, believes that companies hiring based on merit rather than race and gender will perform better in the coming years. The Azoria 500 Meritocracy ETF aims to mirror the S&P 500 index but without the inclusion of companies that prioritize DEI.

The new ETF is designed to attract investors who are skeptical of the impact of DEI practices on corporate performance and who prefer a more merit-based approach to hiring and management. Fishback argues that by focusing on companies that prioritize merit, the ETF can provide better returns and more sustainable growth.

However, some financial experts have raised concerns about the potential risks associated with ideologically driven ETFs. They warn that such funds often charge higher fees and attract limited investment due to their niche focus. Additionally, separating politics and investing can lead to a narrow investment strategy that may not capture the broader market opportunities.

The Azoria 500 Meritocracy ETF joins a growing list of ETFs that focus on specific themes or criteria, such as environmental, social, and governance (ESG) factors. However, the exclusion of DEI-compliant companies from the index is a departure from the more inclusive approach taken by many traditional ETFs. The success of the Azoria 500 Meritocracy ETF will depend on its ability to attract investors and demonstrate strong performance.

The launch of the Azoria 500 Meritocracy ETF coincides with a period of significant market activity and speculation in the financial sector. In recent weeks, MicroStrategy (MSTR) stock has surged on speculation about its potential inclusion in the S&P 500 index, while the newly launched REX-Osprey Solana + Staking ETF (SSK) saw a strong debut with $33 million in trading volume [1]. Additionally, the Azoria Tesla Convexity ETF launch was delayed due to concerns over Elon Musk's political ambitions [2].

Despite the launch of the Azoria 500 Meritocracy ETF, the broader market trends remain positive. Bitcoin (BTC) and Ethereum (ETH) have seen significant gains in recent weeks, with Bitcoin breaking above $109,000 and Ethereum climbing to $2,608 [1]. The crypto market's broader institutional appetite was further validated by a report from Presto Research, which highlighted that BlackRock’s iShares Bitcoin ETF (IBIT) is now on track to generate more annual revenue than its flagship iShares Core S&P 500 ETF (IVV) [1].

References:
[1] https://blockchain.news/flashnews/microstrategy-mstr-stock-surges-on-s-p-500-speculation
[2] https://www.bhaskarenglish.in/business/news/azoria-tesla-convexity-etf-launch-delay-after-musks-america-party-135385315.html