- The DEMZ and MAGA ETFs offer investors a way to express their political beliefs through their investments.
- DEMZ primarily includes companies that donate to Democratic campaigns, while MAGA buys up Republican-leaning businesses.
- DEMZ has outperformed MAGA and the S&P 500 since its November 2020 launch.
Politically interested market participants can express their views through their investments by buying shares in Democratic or Republican leaning exchange-traded funds, and, based on returns, gain an advantage in this area of ​​American political debate.
Both the PointBridge America First ETF and the Democratic Party Large Cap Core ETF base their investments on corporate political donations.
“The Democratic Large Cap Core Fund is the first investment product to attempt to replicate the S&P 500 without the Republicans,” the fund’s website states.
Members of the fund, which will trade under the ticker symbol “DEMZ,” must give at least 75% of their political contributions to Democratic causes and candidates.
Meanwhile, the Republican ETF, which trades under the ticker symbol “MAGA,” includes about 150 companies in the S&P 500 index that “strongly support the Republican Party” through their political donations, according to the fund’s website.
So far, ETFs focused on Democrats have outperformed ETFs focused on Republicans on a one-year, three-year, and since-inception basis.
The DEMZ fund, which launched in November 2020, is up 78.3% since inception, compared with 76.6% for the MAGA fund over the same period.
YCharts/Business Insider
Perhaps most impressively, since November 2020, both the DEMZ and MAGA funds have outperformed the S&P 500, which is up about 72% over the same period.
Over the past year, the DEMZ fund’s outperformance has been more pronounced, with the fund up 30% compared to the MAGA fund’s 18% gain. Over the past three years, DEMZ has risen 39% compared to the MAGA fund’s 31% gain.
The DEMZ fund’s strong performance is driven by its concentration in mega-cap technology stocks.
The top five stocks held by the DEMZ fund are Nvidia, Apple, Microsoft, Loews and Costco.
About 36% of the DEMZ fund is invested in technology stocks, compared with just 3% for the MAGA fund.
Instead, the MAGA fund focuses on industrial, financial and energy stocks.
The top five holdings in the MAGA fund are Vistra, Howmet Aerospace, Charter Communications, Amgen and Garmin.
Another area where the DEMZ ETF outperforms the MAGA ETF is assets under management, with the former having around $36 million invested and the latter around $21 million.
