Praxis Investment Mgmt. Launches New ETFs and Releases Research on Faith-based Investing

Praxis Investment Management^TM, a company of Everence^® and a leading investment manager serving values and faith-based investors, has launched its first two exchange-traded funds (ETFs) — Praxis Impact Large Cap Growth ETF (PRXG) and Praxis Impact Large Cap Value ETF (PRXV). Both funds began trading on the NYSE on April 8.

“Our new active ETFs are designed to meet the demand of values and faith-based investors,” said Chad Horning, President of Praxis Funds^TM. “Investors want competitive, values-driven investment options and they want to talk with their financial advisors about investing with their faith in mind, and these products facilitate that conversation.”

PRXG and PRXV deploy quantitative equity strategies similar to those used in the Praxis Growth Index Fund (MMDEX) and the Praxis Value Index Fund (MVIIX).

Praxis built its reputation on delivering competitive, benchmark-level returns in core, mutual fund portfolio holdings, integrating shared values and a set of impact strategies designed to promote real-world change. MMDEX (2007) and MVIIX (2001) have been an important part of that history for almost 20 years. Praxis has now brought that optimized, index-like investment approach into the ETF arena in both the large cap growth (PRXG) and large cap value (PRXV) space. The ETFs and mutual funds are similar in many ways. For example, the ETFs are technically “non-diversified” funds, which may help them track their benchmarks even more closely in situations when the largest names in a benchmark exceed limitations for “diversified” funds. The Praxis ETFs also bring the unique application of Praxis ImpactX strategies in an ETF product.

“Praxis has been a leader in faith-based mutual funds for more than 30 years,” said Mark Regier, Vice President of Stewardship Investing. “For much of that time, shareholders preferred to work with financial advisors who typically used mutual funds to build portfolios. In recent years, investors and their advisors have been choosing ETFs to access the markets because of their ease of purchase, and for taxable accounts, more favorable tax treatment. This broader market trend has also influenced the way faith-based investors want to invest. While Praxis is not the first faith-based firm to issue ETFs, we think our approach to investing will appeal to investors who want real world impact and who desire practical solutions to their investment objectives.”

The funds seek capital appreciation and performance similar to the CRSP US Large Cap Growth Index and CRSP US Large Cap Value Index respectively. Praxis applies equity screens consistent with its core values and utilizes optimization techniques to attempt to limit benchmark tracking error. The funds are meant to serve as core allocations – “the heart of your portfolio.”

“All Praxis funds embody our stewardship investing core values and use our ImpactX framework to create real-world impact,” said Benjamin Bailey, Vice President of Investments. “Research shows that investors want advisors who understand and engage with their faith-based investing preferences. Our new ETFs provide practical solutions for advisors looking for lower cost, liquid, tax-efficient, values-driven investment options to serve these clients.”

Bailey heads the team managing PRXG and PRXV. Bailey has over 20 years of investment management experience and has managed Praxis portfolios since 2005.

The expense ratios for both funds are 0.36%.

Concurrent with the ETF launches, Praxis released the results of research highlighting a largely untapped opportunity for financial advisors to strengthen their understanding of and service to their clients. The findings are based on a survey of 1,001 individual investors controlled for age, region and gender, and 403 financial advisors across multiple distribution channels.

Whether and how faith may be considered in investment portfolios is a conversation that 75% of investors want to have with their financial advisor, according to the research report “Faith-based Investing: The conversation clients seek, The value advisors can add.” However, just 9% of advisors are willing to initiate such a conversation.

“This disconnect suggests that advisors run the risk of underestimating or ignoring what’s important to clients,” said Horning. “But the research also explains why: Advisors are uncomfortable with the topic, have relatively low levels of awareness of solutions available, and lack confidence in the efficacy of those solutions. In short, they’re reluctant to engage clients on a topic they fear will not produce good results.”

Highlights from the Research:

• 65% of advisors perceive a lack of client demand, interest and/or awareness.
• Only 59% of advisors are aware of faith-based investments.
• Advisors report a lack of product availability, doubt that investment performance results can be competitive, and believe that screening processes can be counterproductive to strong returns.
• Despite the barriers and misconceptions identified, advisors and investors who are aware of faith-based investing share positive views on its benefits. There’s consensus in the data that faith-based investing empowers investors to feel a sense of purpose and fulfillment.
• Many expect faith-based investing to gain popularity over the next decade.

“Clients want to align their faith with their investments in order to create real impact,” said Regier. “The broader availability of lower cost, liquid, tax-efficient faith-based ETFs can help raise awareness and prompt advisors to explore their options for serving these values-driven investors.”

“Now is the time to ask your clients about their thoughts on faith-based investing,” Regier encourages financial advisors. “Engaging clients about their values has the potential to build stronger connections, create a deeper understanding of the client, and demonstrate value by introducing them to an investing approach they may never have considered.”

The research was conducted by Bellomy Research in the fall of 2024.

To download a copy, visit https://www.praxisinvests.com/research.

  

About Praxis Investment Management

Since 1994, Praxis has offered investment products designed to meet practical needs for everyday investors seeking to steward their assets consistent with their desire to promote positive social and environmental impacts. Praxis brings a faith-based approach to ETFs, mutual funds, multi-fund portfolio solutions and money market accounts. Based in Goshen, Indiana, Praxis is a company of Everence Financial. Learn more at praxisinvests.com.

CRSP US Large Cap Growth Index: Represents the Growth Style for companies covering top 85% of cumulative capitalization of CRSP US Total Market. It is not possible to invest in an index. 

CRSP US Large Cap Value Index: Represents the Value Style for companies covering top 85% of cumulative capitalization of CRSP US Total Market. It is not possible to invest in an index. 

An investor should consider the investment objectives, risks, and charges and expenses of the fund carefully before investing. A prospectus and a summary prospectus which contains this and other information about the fund may be obtained by visiting praxisinvests.com/prospectus. The prospectus and the summary prospectus should be read carefully before investing.

Investing involves risk. Principal loss is possible.

ETFs are subject to additional risks that do not apply to conventional mutual funds, including the risks that the market price of an ETF’s shares may trade at a premium or discount to its net asset value, an active secondary trading market may not develop or be maintained, or trading may be halted by the exchange in which they trade, which may impact an ETF’s ability to sell its shares. Shares of any ETF are bought and sold at market price (not NAV) and are not individually redeemed from the ETF. Brokerage commissions will reduce returns.

Praxis Mutual Funds^® and Praxis ETFs^TM are distributed by Foreside Financial Services, LLC.