New ETF Highlights ‘Clean Living’

Amplify ETFs is targeting yet another key trend with the launch of its latest ETF. The Amplify Cleaner Living ETF (DTOX) aims to capture the performance of companies catering to consumer preferences for “cleaner” products and services.

The new fund comes with an expense ratio of 0.59% and lists on the NYSE Arca.

“Consumer, government and corporate spending is powering this mega-trend, and we believe companies with a majority of their revenue from cleaner living products and services are positioned to thrive,” said Amplify ETFs CEO Christian Magoon, noting that the trend is just getting started.

A press release from his firm cites a recent survey finding 70% of consumers prefer brands that offer cleaner products and services, and support sustainability and environmental responsibility.

DTOX tracks the Tematica BITA Cleaner Living Index, which targets five market segments offering “cleaner” options to consumers:  building and infrastructure; energy; food and dining; health and beauty; and transportation.

While a “pure play” company is generally classified as simply generating the majority of its revenues from the targeted category, the companies included in DTOX’s index must derive at least 80% of their revenues of earnings from one of those market segments.

For the purposes of the index, the term “cleaner” implies that the targeted company is taking steps to ensure its products or services have a mostly positive impact on the human body and the environment, the prospectus indicates.

That translates into the use or creation of environmentally friendly processes; recycled or sustainable materials; organic or non-GMO foods; natural or toxin-free ingredients; and electric vehicles.    

Eligible securities must be listed in the U.S. and meet minimum size and liquidity requirements. The index is rebalanced and reconstituted twice a year, and as of DTOX’s launch, included 78 holdings, according to the prospectus.

Contact Heather Bell at [email protected]