For investors seeking to align their financial decisions with their personal values, faith-based ETFs may present a unique opportunity.
However, understanding the fee structures associated with these funds is necessary for making informed choices. Comparing fees across faith-based ETFs as well as conventional options allows investors to assess the cost of their investments.
Over extended investment horizons, even a seemingly small expense ratio can compound negatively, significantly eroding overall returns. Investors should carefully consider the expense ratios associated with their investment choices. They should also recognize that lower fees generally translate to greater long-term wealth accumulation.
While expense ratios among faith-based ETFs vary, a JLens analysis comparing the TOV ETF to other faith-based U.S. large-cap ETFs indicates that the JLens 500 Jewish Advocacy U.S. Index ETF (TOV), with an expense ratio of 18 basis points, is priced competitively compared to many Christian and Muslim-focused funds.
Notably, it is the first and only large-cap U.S. equity Jewish-themed ETF. Thus, it fills a significant void in the overall investment landscape. The TOV ETF offers investors the opportunity to align their investments with Jewish values. This includes combating antisemitism and supporting Israel, while aiming to deliver performance comparable to index funds tracking the 500 largest U.S. public companies.
As of February 3, 2025, the JLens analysis of ten faith-based U.S. large-cap ETFs (excluding TOV) showed an average expense ratio of 35 basis points. Large faith-based ETFs like the $1.2 billion SP Funds S&P 500 Sharia Industry Exclusions ETF (SPUS), the $918 million Global X S&P 500 Catholic Values Custom ETF (CATH), and the $600 million Wahed FTSE USA Shariah ETF (HLAL) have expense ratios of 45, 29, and 50 basis points, respectively.
How Faith-Based ETFs’ Costs Compare to Broad Market ETF Giants
Although the TOV ETF’s expense ratio is higher than some of the largest market index ETFs, with market giants like the $584 billion iShares Core S&P 500 ETF (IVV) and the $658 billion Vanguard S&P 500 ETF (VOO) charging just 3 basis points, TOV offers a distinct advantage by integrating Jewish values into the investment process, a feature absent in broader market offerings.
JLens employs Jewish value screens and provides added value through its comprehensive Jewish-values-inspired shareholder advocacy. JLens actively engages with public companies to address antisemitism, support Israel, and promote Tikkun Olam (Repairing the World) through direct dialogue, proxy voting, and filing shareholder resolutions.
The methodology underpinning TOV ensures that proxy votes align with Jewish communal interests. Investments in market giants may inadvertently support proposals that do not align with Jewish values, and these funds may not prioritize Jewish interests in their proxy voting policies.
In conclusion, the TOV ETF effectively balances affordability and values-based investing. The ETF’s expense ratio is notably lower than many of its faith-based peers. While it costs more than the market giants, it offers a distinct investment approach rooted in JLens’ research and advocacy.
For more news, information, and analysis, visit the Faith Based Investing Channel.
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. The Fund has no obligation or liability in connection with the issuance, administration, marketing, or trading of TOV.
