DEMZ vs ESGU

DEMZCDemocratic Large Cap Core ETF

ESGUAiShares ESG Aware MSCI USA ETF

In short

DEMZ Most index funds sort companies by size or sector. DEMZ sorts them by politics: a passive US large-cap portfolio built from the DEMZ Political Contribution Index, running since 2020 for investors who want the screen to reflect their values.

ESGU Screening out companies is easy; keeping the market's shape while you do it is the hard part. ESGU's index optimizes toward stronger ESG characteristics while targeting risk and return similar to the broad MSCI USA Index.

Stated mandate

DEMZ The Fund seeks to track the total-return performance of the DEMZ Political Contribution Index before fees and expenses. It uses passive indexing and generally invests in the Index’s component securities.

ESGU Seeks to track an index of large- and mid-cap U.S. companies selected for favorable environmental, social and governance (ESG) characteristics while seeking risk/return similar to the MSCI USA Index.

Why people hold it

• DEMZ The values screen is a published rulebook, not a manager's mood. DEMZ holds the components of a named index and follows it passively.
• Narrow, plainly stated job: track the DEMZ Political Contribution Index before fees, in US stocks. Little room to quietly drift into something else.
• Live since November 2020, so this is a fund with real operating history behind it rather than a freshly launched concept.

• ESGU Not a screen-and-drop portfolio: the index optimizes toward better ESG characteristics while targeting risk and return similar to the broad MSCI USA Index.ishares.com
• 0.15% a year, below the typical fund in its US ESG group, spread across roughly 300 large- and mid-cap names rather than a narrow shortlist.
• Running since 2016, a multi-billion-dollar iShares fund that pays quarterly and sits in the top quartile of a crowded US ESG peer group.

Worth knowing

• DEMZ 0.45% a year is ordinary for a themed index fund, but broad core wrappers price far lower: SCHK at 0.03% and VT at 0.06%.
• Small in assets and thinly traded. Limit orders matter more here than in mega-cap index funds, where shares change hands constantly.
• A political-contribution screen shrinks the eligible pool, so the holdings can look different from a plain US large-cap index.

• ESGU Cheaper seats in the same row: XVV at 0.08%, ESGV at 0.09%, SNPE and EFIV at 0.10%, against 0.15% here.
• Market-like risk is the stated goal, so exclusions are lighter than a purist ESG fund and the holdings end up looking a lot like the broad US market.ishares.com
• MSCI's ratings decide who makes the cut, so the portfolio reflects one provider's definition of ESG, not an industry standard.ishares.com

Full DEMZ profile⁠

Full ESGU profile⁠