Social Values Choice Equity Fund (SVCEF)

Fund Update

On April 7, 2018, the name of the Equity Social Values Plus Fund (ESVPF) changed to the Social Values Choice Equity Fund (SVCEF), to align with the naming convention adopted for the “Social Values Choice” suite of funds. The fund strategy remains unchanged.

 

Fund Overview: Objective, Strategy and Holdings

The Social Values Choice Equity Fund (SVCEF) seeks to attain long-term capital appreciation from a passively-managed portfolio of U.S. and non-U.S. domiciled publicly owned companies that fulfills investor preferences for a heightened focus on corporate environmental and social performance.

The Fund generally does not invest in companies that derive more than 10% of their revenue from gambling or from the manufacture, sale or distribution of alcoholic beverages, tobacco-related products, adult entertainment, weapons, or the management or operation of prison facilities.

 


Performance, Net of Fees

 

Performance Review

 

Fund Characteristics and Statistics

 

Holdings and Allocations

 

Expense Ratio

 

Risks and Disclosures

 

 


Performance, Net of Fees - June 30, 2019

  3 mo YTD 1 yr 3 yr 5 yr 10 yr Since
Inception
Social Values Choice Equity Fund 4.41% 17.21% 8.62% 11.53% N/A N/A 7.60%
Fund Benchmark 4.35% 16.86% 8.54% 11.69% N/A N/A 7.75%
 

See Risks and Disclosures for more information regarding Net of Fees Performance.

 

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Performance Review

For market and fund commentary, please review the Monthly Investment Report.

 

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Characteristics as of June 30, 2019

SVCEF_chart

 

Fund Statistics as of June 30, 2019

  SVCEF SVCEF Benchmark**
Wgt. Mkt. Cap ($MM) $152,895 $152,608
Price/Earnings 18.9 18.9
Price to Book 2.8 2.8
Dividend Yield*** 2.4% 2.4%
# of Stocks 753 770

** The benchmark is the MSCI World Environmental, Social and Governance (ESG) ex Fossil Fuels Index

*** Does not reflect the deduction of fees.

 

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Fund Holdings as of June 30, 2019

Top 10 Stock Holdings

Company Fund %
Microsoft Corporation 4.9%
Alphabet Inc. 3.3%
Johnson & Johnson 1.8%
Visa Inc. Class A 1.5%
Procter & Gamble Company 1.4%
Walt Disney Company 1.3%
MasterCard Incorporated Class A 1.2%
Verizon Communications Inc. 1.2%
Home Depot, Inc. 1.2%
Merck & Co. 1.1%

A complete list of fund holdings is also available.

 

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Expense Ratio

For 2018, SVCEF’s expenses were equal to 0.48% of the Fund’s total assets.

 

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Risk and Disclosures

SVCEF is designed for investors who have a heightened focus on corporate environmental and social performance, seek long-term investment growth through exposure to the U.S. and non-U.S. public equities of companies, and are willing to accept the risk of wide fluctuations in the unit price of the fund.

All investments carry some degree of risk that will affect the value of SVCEF’s holdings, its investment performance and the price of its units. As a result, loss of money is a risk of investing in the fund. SVCEF is subject to the following principal investment risks: market risk, investment style risk, security-specific risk, country risk, currency risk, derivatives risk and liquidity risk. Additionally, SVCEF is subject to modestly increased diversification risk, as compared to broad-market passively-managed equity funds, as a result of the exclusion of a significant number of stocks from the investment universe (i.e., the exclusion of companies with fossil fuel reserves used for energy purposes).

Historical returns are not indicative of future performance. For further discussion of the Fund’s investments strategies and risks, please refer to the Wespath Investment Funds Description and related documents. This is not an offer to purchase securities.

 

Valuation of SVCEF Units

In the daily valuation of SVCEF units, Wespath uses a valuation methodology to capture changes in non-U.S. securities values that arise because of time-zone differences among global securities markets. Many non-U.S. securities trade on exchanges that close several hours before SVCEF’s closing unit price is calculated in the United States, generally at 4 p.m. Eastern time. In the hours between the close of the non-U.S. markets and the close of the U.S. market, the value of the non-U.S. securities may change due to a variety of factors including, for example, company-specific announcements or market-wide developments. SVCEF’s daily return may diverge from the daily return of its benchmark index, in part, because the benchmark index values do not reflect such price adjustments.

 

Lending of Portfolio Securities

SVCEF seeks to earn additional income by lending a portion of its portfolio securities to brokers, dealers and other financial institutions. The loans are secured at all times by cash and liquid high-grade debt obligations. As with any extension of credit, there are risks of delay in recovery and in some cases even loss of rights in the collateral should the borrower fail financially. In addition, losses could result from the reinvestment of the cash collateral received on loaned securities.

 

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SVCEF Benchmark


The Social Values Choice Equity Fund, formerly the Equity Social Values Plus Fund, performance benchmark is the World Environmental, Social and Governance (ESG) ex Fossil Fuels Index, effective April 1, 2017. Prior to April 1, 2017, the benchmark was the MSCI World Custom Environmental, Social, and Governance (ESG) Special Weighted Index.

Fund Facts

Inception December 31, 2014
Exp. Ratio 0.48% for 2018
Benchmark MSCI World Environmental, Social and Governance (ESG) ex Fossil Fuels Index
Fund Assets $80 Million as of August 31, 2019
Holdings (PDF) June 30, 2019
Unit Price History (XLS) Wespath Funds Price History
For More Information Summary Fund Descriptions – P Series and Investment Funds Description – P Series and the related Statement of Additional Information.
 

Fund Managers

The following individuals are responsible for the selection and monitoring of external asset managers:

brian_boyer

Brian Boyer, CFA

Director, Private Markets
With Wespath since 2003
B.A. and B.E. from Dartmouth College
MBA from The Wharton School at the University of Pennsylvania
CFA Charterholder
 
mark_warren

Mark Warren, CFA, CIMA

Manager, Public Equities
With Wespath since 2015
B.S. from Purdue University
CFA Charterholder
CIMA Certification
 
Revised Investment Guidelines Effective April 1, 2017
The MSCI World Environmental, Social and Governance (ESG) ex Fossil Fuels Index became SVCEF’s benchmark on April 1, 2017. To read more about this change, click here.
 

Management

SVCEF, in response to the concerns expressed in petitions approved by a threshold number of annual conferences, excludes companies with fossil fuel reserves used for energy purposes. Additionally, and in response to the concerns expressed in petitions approved by a threshold number of annual conferences, SVCEF excludes specific companies that are the subject of annual conference resolutions concerning peace in the Middle East. Both the Fiduciary Committee and the UMC Principles Committee of Wespath’s board of directors have approved these additional exclusions.

Like Wespath’s other funds, SVCEF generally does not invest in companies that derive more than 10% of their revenue from gambling or from the manufacture, sale or distribution of alcoholic beverages, tobacco-related products, adult entertainment, weapons, or the management or operation of prison facilities.

External Asset Managers

  • Northern Trust Global Investments*

* Signatory to the United Nations Principles for Responsible Investment

Research and Index Provider

  • MSCI ESG Research
 
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