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A Member of the Silent Majority? 4 Best Politically Conservative ETFs Amid all the ESG investment options, where are the investments for political conservatives? Great question. Here are four ETF options.

By Melissa Brock

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This story originally appeared on MarketBeat

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Usually, politics and stock picking doesn't brew a pot of political turmoil to the same degree as budget negotiations in a joint session of Congress. However, some companies' focus on wokeness and other social justice issues raise the ire of some conservatives.

If you believe that companies should focus on profitability instead of Chicken Little-esque climate change and perceived social justice issues, where does that leave you, as a conservative investor?

Let's look beyond traditionally conservative-bent stocks, such as Exxon Mobil (NYSE: XOM). Let's take a look at why you might want to buy "conservative" ETFs. We'll also focus on three ETFs that advocate for a mix of conservative values — low taxes, free markets, deregulation, privatization and reduced government spending and government debt.

Why Buy "Conservative" ETFs?

A burgeoning list of socially responsible and ESG products have swelled, leaving conservatives out. Nasdaq Inc. has even made a requirement that boards of companies must have at least one director who self-identifies as a female and at least one director who self-identifies as black or Latinx, Asian, Native American or Alaska native, native Hawaiian or Pacific islander, two or more races or ethnicities, or as LGBTQ+. The company must explain itself if it does not have at least two directors on its board who self-identify in the categories listed above. (The National Center for Public Policy has since sued the Securities and Exchange Commission for allowing Nasdaq to create this requirement.)

All of this begs the question: Does every conservative ETF cater directly to only conservative investors and investments? Many conservatives believe that many companies have shifted toward more progressive policies due to social demands. Many conservative ETFs have to cobble together a mix of progressive and liberal companies, keeping out the "worst offenders" by boycotting companies that have a decidedly liberal agenda. For example, an ETF on this list might eliminate companies hostile to conservative values or baldly liberal, such as those that directly oppose the Second Amendment or religious freedom.

Point Bridge GOP Stock Tracker ETF (BATS: MAGA)

With its decidedly Donald Trump-based ticker Make America Great Again (MAGA), you can't get more conservative than actually using the famed Trump slogan. The MAGA Index cherry-picks companies from the S&P 500 Index whose employees and political action committees (PACs) support Republican candidates.

According to the Point Bridge GOP Stock Tracker ETF website, "Money matters in politics, and it affects who gets elected. Our process screens all companies in the S&P 500 Index for political contributions. Under a rules-based methodology, the MAGA ETF is made up of those companies that are highly supportive of Republicans."

MAGA provides investors with a low exposure to the technology sector but has higher weightings in the following sectors:

  • Industrials
  • Consumer cyclical
  • Energy
  • Basic materials
  • Utilities
  • Health care

With an expense ratio of 0.72% and a 14.34% three-year return, the ETF also invests in the following companies:

  • Mosaic Co.
  • Occidental Pete Corp.
  • Halliburton Co.
  • Marathon Oil Corp.
  • Devon Energy Corp.
  • APA Corporation
  • CF Industries Holdings Inc.
  • ConocoPhillips
  • Hess Corp.
  • EOG Resources Inc.

2nd Vote Society Defended ETF (CBOE: EGIS)

From 2nd Vote, the Society Defended ETF is an actively managed fund that invests in companies based on direct and indirect corporate donations, activities and stated policies of companies; sponsorships for political and advocacy-related events, corporate donations and lobbying activities. The ETF includes companies that support the right to bear arms as well as those related to border security. The ETF elminiates companies that donate toward legal immigration or support illegal immigration.

The top 10 holdings, which have a 26.37% one-year return, include the following:

  • Costco Wholesale Corp.
  • O'Reilly Automotive Inc.
  • Fortinet Inc.
  • Goldman Sachs Group Inc.
  • ServiceNow Inc.
  • Texas Instruments Inc.
  • Honeywell International Inc.
  • Diamondback Energy Inc.
  • Fox Corp.
  • AbbVie Inc.

2nd Vote Life Neutral Plus ETF (CBOE: LYFE)

Also from 2nd Vote, the Life Neutral Plus ETF invests its net assets into equity securities of large- and mid- capitalization eliminate U.S. companies that directly or indirectly support abortion or abortion related advocacy groups or legislation, such as any company that provides direct financial support for Planned Parenthood Federation of America and/or the Center for Reproductive Rights. After a year, the fund has returns of 22.69% (with an operating expense ratio of 0.75%) and includes the following holdings:

  • Fortinet Inc.
  • ServiceNow Inc.
  • LAM Research Corp.
  • Home Depot Inc.
  • Regeneron Pharmaceuticals
  • CVS Health Corp.
  • Diamondback Energy Inc.
  • Lincoln National Corp.
  • Steel Dynamics Inc.
  • O'Reilly Automotive Inc.

American Conservative Values Small-Cap ETF (NYSEARCA: ACVF)

The American Conservative Values ETF is based on the belief that politically active companies negatively impact their shareholder returns. The company boycotts ownership of "the worst companies which the adviser determines support liberal causes, charities, advocacy groups, campaigns, candidates, PACs and think tanks," according to its website.

Its holdings, which have an expense ratio of 0.75% and over 33% returns since inception, include the following:

  • Microsoft Corp.
  • Berkshire Hathaway Inc.
  • NVIDIA Corp.
  • Costco Wholesale Corp.
  • Procter & Gamble Co.
  • Tesla Inc.
  • Adobe Systems Inc.
  • Home Depot Inc.
  • Cisco Systems Inc.
  • UnitedHealth Group Inc.

Here's a snapshot of the companies that the ETF boycotts, according to a list derived from the ETF website:

  • American Express Company
  • Bank of America Corp.
  • Lowe's Companies Inc.
  • Nasdaq Inc.
  • Delta Airlines Inc.
  • The Coca-Cola Company
  • Apple Inc.
  • Amazon.com Inc.
  • Alphabet Inc.
  • Blackrock Inc.
  • Comcast Corp.
  • Comcast Corp.
  • Salesforce.com Inc.
  • Walt Disney Co.
  • Dick's Sporting Goods Inc.
  • Meta Platforms Inc.
  • General Motors Co.
  • Goldman Sachs Group Inc.
  • Johnson & Johnson Inc.
  • JPMorgan Chase & Co.

Ready to Consider Conservative ETFs?

Everyone has the right to invest in companies that meet their values, and ESG funds don't meet everyone's definition of "value." If you're feeling left out, it's likely that your values don't align with companies that fit a more liberal agenda. As a member of the silent majority, you can still tap into broad exposure to politically conservative investments through politically conservative ETFs.

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