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Companies that give money to Democrats beat Republican donors in the stock market

 


Nancy Pelosi

Speaker of the House Nancy Pelosi (D-CA) holds her weekly press conference at the U.S. Capitol on August 25, 2021.Kevin Dietsch/Getty Images

  • The DEMZ and MAGA ETFs offer investors a way to express their political beliefs through their investments.

  • DEMZ includes companies that primarily donate to Democratic campaigns, while MAGA buys Republican-aligned companies.

  • DEMZ has outperformed MAGA and the S&P 500 since its launch in November 2020.

Politically minded market participants can express their views through their investments by purchasing shares of exchange-traded funds aligned with Democrats and Republicans and, based on returns, they have the advantage in that corner of the American political debate.

THE Point Bridge America First ETF and the Core Large Cap Democratic ETF both base their investments on corporate political contributions.

“The Democratic Large Cap Core Fund is the first investment product that strives to replicate the S&P 500, without the GOP,” the fund’s website states.

Constituents of the fund, which trades under the symbol “DEMZ,” must have made more than 75 percent of their political contributions to Democratic causes and candidates.

On the other hand, the Republican ETF, which trades under the symbol “MAGA,” includes about 150 companies from around the world. S&P500 index “who strongly support Republicans” through their political contributions, says the fund’s website.

So far, the Democrat-focused ETF has beaten the Republican-focused ETF on a one-year, three-year, and inception basis.

Launched in November 2020, the DEMZ fund is up 78.3% since its creation, compared to a gain of 76.6% for the MAGA fund over the same period.

Stock market performance of Democrats and RepublicansStock market performance of Democrats and Republicans

YCharts/Business Insider

Perhaps most impressive is that since November 2020, DEMZ and MAGA funds have outperformed the S&P 500, up approximately 72% over the same period.

Over the past year, the outperformance of the DEMZ fund was more pronounced, with an increase of 30% for the fund compared to a gain of 18% for the MAGA fund. Over the last three years, DEMZ is up 39% compared to a gain of 31% for the MAGA fund.

The DEMZ fund's outperformance is due to its concentration in mega-cap technology stocks.

The top five stocks held by the DEMZ fund are Nvidia, Apple, Microsoft, LowsAnd Costco.

Around 36% of the DEMZ fund is invested in technology stocks, compared to only 3% for the MAGA fund.

Instead, the MAGA fund is heavily invested in industrial, financial and energy stocks.

The top five stocks held by the MAGA fund are See, Howmet Aerospace, Charter Communications, AmgenAnd Garmin.

Another area where the DEMZ ETF beats the MAGA ETF is in assets under management, with around $36 million invested in the former and around $21 million in the latter.

Read the original article on Business Insider

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2/ https://finance.yahoo.com/news/companies-money-democrats-beating-republican-203101194.html

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