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New ocean health ETF aims to help 'most important ecosystem on the planet'

·Assistant Editor
·3 min read
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Last week, San Francisco-based investing firm Newday Impact launched a new exchange-traded fund (ETF) with a big blue mission.

The fund, which trades under the ticker AHOY, primarily invests in companies engaged in protecting and restoring ocean ecosystems. It will donate 5% of its net revenue to EarthEcho International, a nonprofit that is building a youth movement around ocean conservation.

The ETF "will be a combination of both direct and indirect companies that are supporting ocean health in areas like aquaculture and sustainable fishing, in areas like pollution remediation, and in areas like climate change," Doug Heske, Newday Impact CEO, said on Yahoo Finance Live (video above). "So all of these organizations are leaders in the space, taking very deliberate efforts to combat what are significant changes [that] impact our most important ecosystem on the planet today."

Over 80% of the holdings comprise companies that directly contribute to ocean health by aiding in coastal restoration, cleaning up plastic pollution, managing sustainable fisheries, or other sustainable practices. The remaining 20% includes large tech companies like Alphabet (GOOG, GOOGL), Apple (AAPL), and Tesla (TSLA) that aren't considered to be overly harmful to oceans.

By investing in these companies, the fund aims to make a dent in some intractable environmental problems.

Earth's oceans have been threatened by pollution, acidification, and overfishing, which have overarching implications for the billions of people that depend on them. Oceans provide half of the earth's oxygen and most of its biodiversity, and are a critical component in the fight against climate change. They are also economic engines, generating 3.3 million jobs and $307 billion in GDP for the U.S. in 2017 alone.

A nurse shark swims across the bottom of the ocean during an outing with company Emerald Charters off Jupiter Inlet, Florida, May 18, 2022.  REUTERS/Sam Wolfe
A nurse shark swims across the bottom of the ocean during an outing with company Emerald Charters off Jupiter Inlet, Florida, May 18, 2022. REUTERS/Sam Wolfe

The intention to help rescue oceans through investment comes at a time when environmentally-focused assets have come under scrutiny.

Growing skepticism around greenwashing, or the practice of marketing sustainable practices while making a minimal impact, hasn't deterred those like EarthEcho International Co-Founder Philippe Cousteau Jr. from engaging with ESG funds. Cousteau maintained that value-driven investment vehicles can shift the balance of change by allowing capital to flow into projects helping to address these issues.

“We need to drive economic change, not just conservation and nonprofits,” Cousteau said. “And so we need to figure out how we tap into financial markets. And while certainly not all ESG vehicles are created equal, it is an important movement.”

Cousteau also highlighted the particular role ETFs can play in driving social change by opening up investment opportunities to retail traders and hedge funds alike.

“ETFs are really a valuable tool because I like to think of them as a democratic investment tool,” he said. “It allows access to anybody to be able to trade and to invest in these kinds of investment tools that can help build the kind of future that we all want. And that's important because this is something that everybody needs to be able to be involved in.”

Grace is an assistant editor for Yahoo Finance.

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