Conservative ETF Divests From Tyson Amid Political Backlash

A politically conservative ETF that boycotts companies with a perceived bias toward progressive politics has divested from foods giant Tyson Foods Inc.—another sign of the growing influence of politics in the funds industry.

The $80 million American Conservative Values ETF (ACVF), which was founded in 2020 to reflect politically conservative values, announced in a press release Wednesday that it had shed Tyson stock from its holdings and placed a "refused to buy" label on the stock. 

The announcement followed a March 11 Bloomberg report that the company was planning to hire migrant asylum seekers to help fill job openings. Rumors that the company was laying off American workers to prioritize migrants triggered conservative backlash based on the misinformation.

Although Tyson said that the plant closure in Perry, Iowa was unrelated to its hiring asylum seekers to fill vacancies, William Flaig, CEO and founder of Ridgeline Research—the fund’s issuer, said in an interview on Fox that Tyson was “blundering” into the issue of immigration policy, which is a lightning rod for conservatives.

"ACVF's principled boycotts should reflect concerns within the conservative community," Flaig wrote in a statement. 

As the American public becomes increasingly polarized, a number of ETF issuers have developed products to target investors' political beliefs. A number of these funds have aligned with conservative beliefs that many large financial firms lean toward progressive causes, noting that some screen for environmental, social, and governance (ESG) in their funds.  

Issuers Reflect Political Leanings

Former U.S. Presidential candidate Vivek Ramaswamy helped popularize a conservative, activist investing thesis focused on pushing companies to roll back climate and diversity initiatives. The asset management firm he helped found, Strive Asset Management, now has $1.31 billion in assets. 

Politically focused value funds cut across the aisle, though. The $32 million Democratic Large Cap ETF Core (DEMZ), holds companies where the top executives donate 75% of political contributions to Democratic candidates.

The conservative ACVF maintains in its investment thesis, that "politically active companies negatively hurt shareholder returns, noting that the issues and causes they support oppose "conservative political ideals, beliefs, and values.” 

BlackRock Inc., the world's largest asset manager, Goldman Sachs Group Inc., Delta Airlines Inc., and Apple Inc. are all included on the fund’s boycott list. Yet with only $80 million in the fund, ACVF’s lack of investment is unlikely to shape these companies' policies.

Over the past year, ACVF is up 33%, and the fund has risen 10% year to date, roughly matching the performance of the S&P 500 Index, according to etf.com data. 

Contact Lucy Brewster at [email protected].