Is Investing Beyond the Mag 7 Crazy?
It is. Crazy, like a fox. Here are the top three reasons to invest beyond the Mag 7:
Many financial products are the Mag 7 in a different wrapper. A fund might have a thematic name and then, when reviewed with a quick glance at the top 10 holdings, one realizes that it is really a screen boiling down to the same 7-10 companies. This can lead to a lack of diversification, otherwise known as Concentration Risk. Lack of diversification is not only risky, as a large sway in the market can move an entire portfolio, but diversification is also a fiduciary duty.
The EATV ETF is diversified across the global food and material supply chains, providing diversification and exposure to a growing sector with a $14-$19 trillion total food systems addressable market.
The EATV top 10 holdings as of January 1st, 2025 are Ingredion, On Holdings, Vitasoy, Sensient Technologies, Vita Coco, McCormick & Co, Fresh Del Monte, Mission Produce, SunOpta and Seneca Foods. For the full list of companies in EATV, click here.
2. Impact
While returns are (almost) everything, bringing down the carbon footprint of client and individual portfolios is good for business. It can keep clients happy, provide client and firm alpha, and maintain high standards of stewardship in business. With increasing relevance, firms, like banks, will also have to account for their carbon footprint.
The EATV ETF is the only ETF certified as carbon neutral without buying offsets according to ACA Global's Ethos ESG. EATV maintains a 1.18C global temperature warming potential, well under The Paris Accords' suggested 1.5C. For a benchmark reference, the S&P 500 Index is 2.86C.
3. Early Bird (Smartly) Gets the Worm.
Do you wish you bought Nvidia before the split at $70 rather than $700? Getting in on a secular trend early has the potential for the most growth capture and alpha.
The EATV ETF, by investing in the innovative companies creating compatible and diversified proteins and syn-bio technologies, seeks to capture the $14-$19 trillion food systems transformation. This shift has indications of large-scale mass adoption as natural resources dwindle, population increases, and climate pressures loom. In short, the window to do nothing is closing and we will be forced to begin creating efficient and less damaging protein.
Food, second only to fossil fuels and larger than transportation in terms of emission impact, is responsible for 30% of the world's greenhouse gas emissions. It is also the primary driver of biodiversity loss and deforestation according to the United Nations Environment Programme. These pressures, expenses, and a mounting pandemic risk are driving an inevitable shift in how we create our food.
Get in early on the innovations that are driving a novel and healthy food system shift and, like the early bird, stay well fed.
Below is a chart by Synthesis Capital of an average of the estimations of food systems transformation growth by investment firms UBS, Credit Suisse, Jeffries, and others.
For more information on the EATV ETF, visit https://EATVetf.com.
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Exchange Traded Funds (ETF) are bought and sold through exchange trading at market price (not NAV), and are not individually redeemed from the fund. Shares may trade at a premium or discount to their NAV in the secondary market. Brokerage commissions will reduce returns.
The fund's investment objectives, risks, charges and expenses must be considered carefully before investing. The prospectus and summary prospectus (if available) contains this and other important information about the investment company, and it may be obtained by calling 1-424-237-8393, emailing [email protected] or visiting EATV.VegTechInvest.com. Read it carefully before investing.
The compound annual growth rate (CAGR) is the rate of return (RoR) that would be required for an investment to grow from its beginning balance to its ending balance, assuming the profits were reinvested at the end of each period of the investment's life span.
Investing involves risk including the possible loss of principal. Past performance does not guarantee future results.
Alpha refers to excess returns earned on an investment above the benchmark return when adjusted for risk.
The fund is an actively managed ETF that does not seek to replicate the performance of a specified index.
Foreign securities may be more volatile and less liquid than domestic (U.S.) securities, which could affect the Fund's investments.
Stocks of companies with small and mid-market capitalizations involve a higher degree of risk than investments in the broad-based equities market.
The fund is non-diversified and may hold large positions in a small number of securities. A price change in any one of those securities may have a greater impact on the fund's share price than if it were diversified.
ESG investing is defined as utilizing environmental, social and governance (ESG) criteria as a set of standards for a company's operations that socially conscious investors use to screen potential investments. The Fund's policy of investing in companies as a means to promote positive climate change could cause the Fund to perform differently compared to similar funds that do not have such a policy.
The fund EATV was carbon neutral during the third and fourth quarters of 2022, based on data provided by VegTech? Invest and an independent assessment conducted by Ethos Impact Inc. ("Ethos ESG").
In order to identify emissions reduction potential, Ethos reviewed a variety of lifecycle analyses (assessments of the carbon footprint of a product over its entire "lifecycle") from the University of Michigan, Boston Consulting Group, and others. These analyses quantify the typical emissions reduction associated with converting from beef to plant-based meat, implementing green vertical farming, investing in plant-based products and innovations, and making other transitions to plant-based industry.
Ethos compared the estimated carbon footprint of the holdings in EATV (the Scope 1, 2 and 3 emissions that EATV is responsible for through its investment in each holding) with the expected impact of emissions that are avoided for each holding. Based on this analysis, Ethos determined that the aggregate carbon avoidance potential of all EATV holdings was greater than the estimated carbon footprint -- i.e., an investment in EATV results in a net reduction of carbon (AKA Carbon Negative), when considering the expected emissions avoided.
The certification is not intended to indicate "absolute" zero emissions, but rather the relative impact when compared to meat and other alternatives.
EATV is distributed by Quasar Distributors, LLC.
Quasar is a subsidiary of the group of companies doing business as ACA Group and is an affiliate of Ethos ESG. Neither Quasar, nor any of its directors, officers, or staff, are involved in Ethos ESG's certification process or pay for accreditation, nor does Ethos ESG consider affiliation as part of its certification analysis.
VegTech LLC is located at 1842 Purdue Ave Unit 103, Los Angeles, CA 90025.