Harbor Human Capital Factor US Large Cap ETF

HAPI

Valor de mercado US$ 504 mi

David van Adelsberg, founding partner & CEO at Irrational Capital, joins Scarlet Fu and Eric Balchunas on "Bloomberg ETF IQ." They discuss the Harbor Human Capital Factor US Large Cap ETF (ticker: HAPI), which tracks companies based on the happiness of their employees.

CHICAGO--(BUSINESS WIRE)--Harbor Capital Advisors, Inc. ("Harbor"), the asset manager that curates a select suite of predominantly actively managed ETFs, mutual funds, and collective investment trusts, is proud to mark the three-year anniversary of the Harbor Human Capital Factor US Large Cap ETF (NYSE: “HAPI”), a pioneering strategy that invests in companies demonstrating strong human capital management. Since its inception in 2022, HAPI has offered access to a portfolio of U.S. large-cap comp.

The Harbor Human Capital Factor US Large Cap ETF employs an indexing investment approach designed to track the performance of the CIBC Human Capital Index. During the second quarter, the Harbor Human Capital Factor US Large Cap ETF (“ETF”) returned 11.91%, (NAV), slightly underperforming its benchmark, the CIBC Human Capital Index, which returned 11.97%. Top active contributors during the period included a lack of exposure to UnitedHealth Group and Berkshire Hathaway (Class B).

With the completion of a close presidential election, roughly half of us are likely disappointed regardless of the winner. To counter the post-election blues, I identified some “happy” ETF themes to consider for investment.

HAPI ETF uses a proprietary method to select 150 U.S. large-cap companies with strong corporate cultures. It's an unusual source of potential alpha, but HAPI has outperformed SPY by 10%. Dan Ariely, co-founder of Irrational Capital, attempts to quantify the employer-employee relationship by focusing on intrinsic motivation, perceived compensation fairness, and limited bureaucracy. However, HAPI has not succeeded based on the human capital factor alone. As I will demonstrate, its starting universe, weighting scheme, and sector-neutral approach are crucial to the fund's success.

Some investors want to take a socially conscious approach to their portfolios. Some try to keep things more simple by investing in companies they believe are likely to be good financial performers, to support rising share prices.