Funds Group: TrueMark Investments
Management Company: Investment Adviser: TrueMark Investments, LLC; Sub-adviser: Purview Investments, LLC,
Funds Affected: TrueShares ESG Active Opportunities ETF
Principal Sustainable Investment Management Strategy: ESG Integration
Summary:
The Fund is an actively managed exchange-traded fund that pursues its investment objective by investing, under normal circumstances, at least 80% of its net assets (plus any borrowings made for investment purposes) in the common stock of environmental, social, and governance (ESG) companies.
The fund considers ESG companies to be those that adhere to ESG best practices, measured at the time of investment using a proprietary screening and selection process. For purposes of the foregoing policy, “ESG best practices” consist of promotion of leadership diversity, reduction of carbon emissions, and implementation of minority hiring practices. At a minimum, the fund will evaluate companies in ESG category with a heavy emphasis on the quantitative data (i.e., numerical data) that is available, specifically with regard to total carbon emissions. Management evaluations will be supplemented with third party scores to provide a secondary check on corporate ESG best practices.
A two phase process will be utilized in selecting companies for the portfolio. In the initial phase, a proprietary ESG best practices proprietary screening process will be utilized which is comprised of hundreds of data points from various sources, including the companies and third party providers, to evaluate ESG characteristics. This initial screen specifically includes quantitative measures that score the carbon emissions of each company. In the final step of the initial phase, the companies are screened against traditional aspects of ESG best practices (e.g., promotion of leadership diversity, reduction of carbon emissions, and implementation of minority hiring practices). Once completed, the initial phase produces an investable universe of approximately 100-150 companies, and each company in the universe is then assigned an ESG rating.
After applying a proprietary valuation analysis to the universe of investable companies, a universe of securities is identified that combine both high ESG ratings and that can deliver better than average returns. The remaining universe of companies is ranked ordered and the final portfolio consisting of approximately 75-125 securities is selected.
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