Category: ETFs

Investing Through the Inferno

A midyear check-in light on the data, some charts and how it all feels.

There’s no way we’re already halfway through 2025—you’ll just have to bear with me as I run it back to April. You remember her, right? A time before it was 90 degrees everyday, before I thought I would burst into flames right on the concrete.

April was the beginning of my tour, Nick Cave in Boston, St. Vincent in New Haven, pour me another tequila soda. Then May in Texas for one suffocating minute, then the madhouse, then the grave. Just kidding—June was another story, but we did it to death, avoided the rain and the heat almost took us out completely. The Kills killed it three times until we prayed for mercy from the sun. No longer our god, we watched it sink behind the stage while the heat tore through Queens of the Stone Age’s set. We don’t even have to talk about how much my credit card statement was after all that, you get the idea!

Net worth & portfolio in the green

April was also when the tariffs brought everyone to me, asking what they should do with their investments. I told my friends, “Don’t look at your accounts,” and then opened every single one of mine to calculate my net worth as of the end of March. My strategy won’t be stopped by the nonsense! At the end of June, my Charles Schwab brokerage account is not only back to where it was before the announcement, but it has now surpassed that amount. I said, “Everything will be fine in, like, two months,” and thankfully, the numbers didn’t make a fool of me like they usually do!

Despite the ongoing destruction of the Earth and the people who live here, my net worth is increasing and my portfolio is profitable. I haven’t been checking my investments as often because I know it doesn’t matter what they look like now. All that matters is I’m keeping my money in the market so it will continue making me more money.

My portfolio of sustainable exchange-traded funds (ETFs) is performing well. When I checked their grades on As You Sow as of the end of June, almost all the ETFs had A’s and B’s. The Amplify Etho Climate Leadership U.S. ETF’s (ETHO) gender equality grade improved from F to B, removing it from the probation it was placed on after my last review. My Schwab U.S. REIT ETF (SCHH) maintains its gender equality grade of C—come on real estate sector, let’s get that up! One of my latest additions, the Stance Sustainable Beta ETF (CHGX), is now on probation with a gender equality grade of F. If the grade doesn’t improve by my next review in six months, the ETF will be removed from my portfolio. Since no changes are needed, my portfolio will remain untouched until then.

Finance charts? Sure, why not?

I have some new resources to share with you all, in the form of charts! I promise I’ll keep it light, but if you’re looking for a free website to track your investments and their performance, FinanceCharts.com is a helpful place for beginners to start. Here’s the Schwab U.S. REIT ETF’s price over the last year. I can see exactly when the beginning of April sent the holding downward, and I can see its steady climb back up to around where it was in March. I can also see that the ETF has some more recovery ahead if it wants to get up to its last high price from September 2024. The charts are interactive and you can select the time period you want to analyze. I don’t usually do much price analysis with my individual investments, but if I ever need more insight, FinanceCharts.com is waiting.

Source: FinanceCharts.com.

A few months ago, I read the book “Stikky Stock Charts” by Laurence Holt. For full disclosure, I was sent this book for free so I would review it. You can read my full review on Goodreads, but I found “Stikky Stock Charts” a helpful introduction to using charts. I was able to understand the purpose of them with very simple descriptions of different chart trends. The book itself is quite image-heavy, with a chart on almost every page. It covers significant historical events, like the meme-stock craze, and how certain stocks reacted at the time. This grounds investing in the real world, where it belongs. “Stikky Stock Charts” will be another resource to consult when I’m looking at a potential ETF for my portfolio.

Putting my investments on snooze

AAII taught me well, I can sleep at night. I don’t think about my money much anymore. Of course, I want to save more of it, but I also have to stay realistic. Everything keeps getting more expensive. My life is expanding, allowing more experiences in. This is the life I’ve been working toward, and I get to see the dividends—both literal and figurative—that are being paid out.

Here’s to your portfolio going up in the second half of 2025. I won’t wait this long to check in with you again, but I will wait for the temperature to fall a bit!

Learn more about my investing strategy:
New Year, New Investments, Same Strategy
PRISM Step 4: Selecting and Managing Your Investments
Midyear Portfolio Review and Finding an ESG Benchmark

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Digging for VanEck Sustainable ETFs

As I gear up for my next portfolio review at the end of June, I poked around As You Sow’s website to determine if there were any new candidates for my sustainable investing strategy. I began by looking for any mutual funds or exchange-traded funds (ETFs) with fossil fuels grades of A or B. This produced a list almost exclusively of mutual funds, which I am not currently investing in. I started considering a few of them, until I saw their expense ratios. My cutoff for expense ratios is 0.60%, and many of these funds were above 1.00% or even 3.00%—anything this high is the same as throwing my investment dollars into a pit and lighting them on fire!

Not to be defeated by how difficult it has been to find investments that are actually sustainable, I looked at my Charles Schwab brokerage account to see how my current ETF holdings were performing. One of my ETFs in the green, but not the best performer right now, is the VanEck Biotech ETF (BBH). It has all A grades on As You Sow—making its positive performance even better knowing that by investing in this group of companies, I am not killing the earth! This got me thinking that VanEck might have some other good candidates for my portfolio.

At the VanEck fund family page on As You Sow, it displays all funds that are gradable in its database. Since I’m searching based on a high fossil fuels grade, I can see that grade in the last column on the list of funds and narrow my choices based on it.

The VanEck Semiconductor ETF (SMH) has all A grades except for gender equality, which is D. No surprises here, the technology industry has a long way to go before it is equal for women and all genders, but I’m looking for a gender equality grade of C or higher for my portfolio. The VanEck BDC Income ETF (BIZD) looked promising with all A’s but an N/A for gender equality since there wasn’t enough data for a grade. Technically this fits my strategy, so I went over to AAII.com to determine if it was a good fit based on performance and expense ratio in the ETF Evaluator. Though its performance has been steady, its expense ratio is an alarming 11.17%! That performance is certainly not worth 11% of my portfolio’s value, so this ETF is off the list.

I scrolled further until I found the VanEck Environmental Services ETF (EVX), with a fossil fuels grade of B. The rest of its grades are A except for—you guessed it—gender equality at C. This fits my strategy, so let’s all cross our fingers and hope the expense ratio won’t eat into all this investment’s potential …

This expense ratio of 0.55% comes in just below my cutoff of 0.60%! VanEck Environmental Services has earned a potential spot in my portfolio, as it also has average performance over the long term (grades of C) and an A grade for the most recent quarter.

I will perform a similar search to see if I can find anything better when it’s time for my portfolio review. I have a little more peace of mind knowing that there are some hidden gems that will fit my strategy—I just have to do more digging!

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Adding a New Climate Leader and Evaluating My Net Worth

Happy new year, it’s time to check in on my portfolio! At the middle of 2023, my portfolio consisted of five index exchange-traded funds (ETFs) that fit my sustainable investing strategy. It has been pretty difficult to find investments for this approach, so I have had to learn as I go, stretching some of my rules to fit what is available to invest in. The financial industry is still catching up to the environmental, social and governance (ESG) movement, so some patience is required!

The two troublemakers I decided to keep in my portfolio last year have continued to be unimpressive: the Global X CleanTech ETF (CTEC) and the Global X Wind Energy ETF (WNDY). They have average As You Sow grades of B, but Global X CleanTech still has a gender equality grade of F and Global X Wind Energy’s fossil fuels grade remains at C—both grounds for deletion in my strategy. Though their expense ratios are favorable at 0.50%, they are the two worst performers in my portfolio, down 30.8% and 23.6% since addition.

When I searched for possible replacements for these two ETFs, I struggled to find even one that qualified. I began my quest on As You Sow, but the highest-graded ETFs on fossil fuels were severely lacking in all other areas: deforestation, gender equality, civilian firearms and military weapons, prison industrial complex and tobacco. So many had grades of D or F—a far cry from sustainable. I also used AAII’s ETF screener to see if I was missing anything, but the ETFs I found with low expense ratios had abysmal As You Sow grades.

Finally, I stumbled on the Etho Climate Leadership U.S. ETF (ETHO). It has an average As You Sow grade of B, with a gender equality grade of C. It has an expense ratio of 0.45%, which is below my 0.60% threshold. However, it has an expense ratio grade of C compared to its category. I’m trying to invest in ETFs with expense ratio grades of A or B, but I’m choosing to make an exception in this case. Ultimately, this expense ratio is lower than that of my two deletion candidates, meaning it will cost me less to hold it. Etho Climate Leadership also has decent five-year performance but significantly underperformed the market last year along with most stocks and ETFs.

Since I could only find one ETF to add to my portfolio, only one ETF will be deleted. The worst of the two, Global X CleanTech, has got to go! That gender equality grade of F has been dragging it down for too long, and it’s not even helping my portfolio’s performance—what’s the point?

Though I said in my blog post about reprioritizing my goals that I would invest another $2,000 in my Charles Schwab brokerage account if I made changes to my portfolio, I discovered that I should have enough between the proceeds from removing Global X CleanTech and the cash balance in my portfolio to invest an amount in Etho Climate Leadership that is equal to my other holdings. I’m choosing not to add more money this time because I’m also funding some other short-term goals. However, at my midyear portfolio review, I will invest more money into each position regardless of whether changes are made since I’ve been so consistent with my saving.

Speaking of saving, when I was evaluating my portfolio, I also calculated my net worth. I have been tracking my net worth on a quarterly basis consistently since October 2022. Since then, my net worth has increased by a cumulative 45.6%! I have added around $10,000 to my net worth, and I’m excited to see how the next year goes. Time to get even more competitive with myself!

Given all this traction I’ve made on my overall finances, I wanted to see how my net worth stacked up. According to The Hill, as of November 2023, the median net worth for those under age 35 is $39,000, while the average is $183,500. My net worth is below the median for my age range but not by so much that I couldn’t surpass it before turning 35. This gives me some idea of a goal to set for my rate of saving and increasing my net worth going forward.

Wishing you all a prosperous 2024!

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The Carrie Finances: Should I Stop Reinvesting My Dividends?

Back when I was uncovering my hereditary financial habits, I learned that my dad’s mom was an avid dividend investor. When my dad was 15, his mom bought him stock in IBM Corp. (IBM) to get him interested in investing. She also put him to work and had him oversee her dividends. My dad would have to maintain a manual bookkeeping spreadsheet to verify which amounts were going into her account and match the dividend depending on the company and the month. All of this was done on paper, adding another level of difficulty.

These days, the process is much more automated, to the point where you might not even know when you receive dividend income unless you regularly check your brokerage account. After years of reading about reinvesting dividends in articles for AAII Dividend Investing, I couldn’t help but wonder: Should I stop reinvesting my dividends for a little extra income in these hard times?

A dividend is a payment that companies make to their investors using excess profits, usually on a quarterly basis. Much like an annual cost of living adjustment in salary, companies are expected to increase their dividend annually to keep up appearances and keep their investors around.

My portfolio is invested in five environmental, social and governance (ESG) exchange-traded funds (ETFs). I don’t require any dividends as part of my investing strategy, but when I started investing, I chose to reinvest the dividends that each of my ETFs pays. The most common way investors reinvest their dividends is through an automated process called a dividend reinvestment plan (DRIP). These plans require that you hold at least one share of the dividend-paying security in a brokerage account.

The main advantage to reinvesting your dividends is the magic of compounding: An investment that reinvests in itself will make more money in the long run. When a dividend is reinvested, it means that you are buying more shares of the security with that dividend. I can tell which of my investments have dividends in my brokerage account by looking at the number of shares I own under “Quantity”:

Most of my share counts are not whole numbers, even though I initially bought whole shares of each ETF. Some investments don’t allow you to buy fractional shares, so this is another advantage of reinvesting dividends. There are also no fees involved in the dividend reinvestment process, which used to be more of a flex before most brokers made investing commission-free.

According to Investopedia, one of the times you should consider not reinvesting your dividends is when you are in or nearing retirement and need the extra income. Likewise, if an investment is not performing well, it’s not a good idea to reinvest more money in that holding.

Now for the moment of truth: How much dividend income is my portfolio receiving? In 2022, I got a whopping $4.03 in dividend payments. So far in 2023, I’ve received $20.08 in dividends, which was a direct result of adding more money to my investments. My Charles Schwab brokerage account estimates that I will receive a total of $48.53 in dividends this year.

Unfortunately, I don’t think $50 would make that big of a difference if I chose to stop reinvesting my dividends. (It certainly wouldn’t buy Carrie Bradshaw a new pair of shoes, but it might cover her drive-thru order below!) Regardless, the money would still be sitting in my brokerage account cash balance waiting to be invested, so I don’t see much of an advantage to interrupting the compounding process.

For now, I’m going to continue reinvesting my dividends and keep an eye on how that income increases as time goes on. If one of my ETFs performs so poorly that I don’t want to invest more money in it, it would be a candidate for deletion before I would consider stopping the dividend reinvestment process.

Midyear Portfolio Review and Finding an ESG Benchmark

We made it to the second half of the year already, which means it’s time for a midyear portfolio review! Let’s analyze my seven exchange-traded fund (ETF) holdings and determine if any of them will get the guillotine.

My review process involves looking at my portfolio holdings’ performance, expense ratios (how much investing in the ETF will cost me per year) and their As You Sow grades on fossil fuels, deforestation, gender equality, sales of guns and military weapons, the prison industrial complex and tobacco. I have potentially four holdings that could be deleted, but will I be replacing all of them?

All of my holdings are looking good on expense ratios and their grades; they’re all below 0.60% and have grades of A or B. However, three of my ETFs are having “Gender Trouble” (Judith Butler, 1990) with gender equality grades of F. One ETF’s fossil fuels grade slipped to C. These grade changes are all grounds for deletion in my investing strategy. When evaluating my ETFs on their performance, the four with unsatisfactory As You Sow grades were also the worst performers since being added to my portfolio:

I had a lot of trouble finding replacements for these ETFs that fit my stringent criteria for addition. Possibilities included the Fidelity MSCI Information Technology Index ETF (FTEC), with a prison industrial complex grade of C dragging it down, and the Nuveen Winslow Large-Cap Growth ESG ETF (NWLG), with all A’s and B’s on As You Sow but an expense ratio of 0.64% (grade of D).

Many of AAII’s model portfolios have a rule that if there are no suitable replacements for a stock, the stock should remain in the portfolio until one with better prospects is found. I’ve been thinking about implementing a similar rule for my own portfolio, but with a twist. Since I don’t have a certain number of ETFs that I am required to hold in my portfolio, I could delete an ETF without replacing it. My only rule is that I shouldn’t hold more than seven ETFs at once (for diversification purposes), but what if I held five instead?

Based on their poor performance and gender equality grades of F, I will be removing the Global X Hydrogen ETF (HYDR) and the Global X Solar ETF (RAYS) from my portfolio. I won’t be replacing them with anything new at this time, but hopefully when my next portfolio review rolls around at year-end, I can find something worthy. The other two underperformers with grade slippage will be reevaluated at my next portfolio review as well. Maybe they can get those grades up before then!

With my midyear lump-sum investment of $2,000 added to my brokerage account, I will buy more shares of my current holdings and make sure the money is as evenly distributed as possible among the ETFs.

Using AAII’s My Portfolio tool, I checked how my portfolio would be diversified after removing these two ETFs. I found that my allocations to domestic and foreign stock moved closer to the recommendation from the AAII Aggressive Allocation Model:

Recently, AAII’s lead editor of the Stock Superstars Report (SSR) Matt Markowski wrote about the benchmark used for the SSR portfolio. Choosing a benchmark for my own portfolio has been on my mind for a while. According to the article, “A portfolio benchmark allows individual investors to gauge the relative performance of their portfolios.” Especially in the current investment environment with a lot of red, I thought it would be important to see how my portfolio is doing compared to the majority of environmental, social and governance (ESG) investments.

Most of the ESG indexes I initially found had companies in their top 10 holdings that I wouldn’t touch with a 10-foot pole (Amazon, Apple, Tesla, Microsoft). Many of the indexes I found had more of a domestic focus, but since I have a sizable allocation to foreign stock, I knew my benchmark index would need a global view. Finally, I stumbled on Morningstar’s Global Markets Sustainability index. Morningstar’s transparency made it easy to see exactly what the index holds and how it’s constructed:

Year to date through June 30, 2023, the Morningstar Global Sustainability index is up 14.3%. My own portfolio’s performance isn’t in positive territory, but it’s good to know that it’s possible to outperform while sustainably investing.

PRISM Step 5: Monitoring Your Allocation, Progress and Life Stages

This is the final post in this initial series. You can read the rest of these blog posts here to learn more about how to use the AAII PRISM Wealth-Building Process!

PRISM is a five-step method for aligning my investment decisions with my goals, created by AAII Journal editor Charles Rotblut. The fifth step details how to use PRISM as a cyclical process that changes as you and your investments age.

The final step of PRISM contains three parts of your financial life to monitor: allocation, progress and life stages. Asset allocation is the process of dividing your investments between different categories like stocks, bonds and cash. Currently, my investment portfolio and my retirement account are pretty much fully allocated to stocks via exchange-traded funds (ETFs), but I have around $80 in cash in my Charles Schwab brokerage account.

Using AAII’s My Portfolio tool, the A+ Investor Asset Allocation Analyzer shows me that the breakdown of my portfolio of index ETFs is a bit off from the AAII Aggressive Asset Allocation Model. The aggressive model calls for 60% invested in domestic stock, 30% in foreign stock and 10% in bonds. My index ETFs round out to 53.5% domestic stock and 46.4% foreign stock, and obviously nothing is in bonds (which, according to AAII founder James Cloonan, is a sound portfolio strategy). I decided to take a look at my 403(b) retirement account as well to see if the average asset allocation of my overall investments could be closer to the aggressive model. My 403(b) has 80.3% in domestic stock and 17.1% in foreign stock. Combined with my index ETFs, my average allocation is 66.9% to domestic stock and 31.8% to foreign stock—definitely closer to the model!

During my next portfolio review at the end of June, I might take a deeper look into my allocation, but for now I’m happy with where I stand.

Next on the list is to check my progress toward my goals. Back in the first step of PRISM, I determined my short-, intermediate- and long-term goals and how much I thought I would need for them. My nearest-term goal is to accumulate $2,000 for the next lump-sum investment in my brokerage account. I’m using my SmartyPig high-yield savings account to track this goal and have about $500 more to go. By my next portfolio review, I should have realized this goal. My goal of buying property in the next three to five years has an estimated cost of $35,000. I’ve been neglecting this goal because the housing market has been ridiculous and, after determining the pros and cons of owning property, I decided that renting is my best option until I feel the need to run away and become a forest witch! Even so, I should be taking more advantage of the 4.25% yield my LendingClub savings account is offering. I currently have around $7,200 and if I can add money more consistently to this account, I could be a lot closer to my goal in the next five years.

The last part of the fifth step of PRISM is to assess any life stage changes that have occurred. Using the Monitoring Your Life Stages worksheet, I determined that nothing has changed, except that I have to walk a lot more to stave off knee and back pain!

Though I made it through all five steps of PRISM, that doesn’t mean I’ll never look at my investments through the lens of PRISM again. When a life stage change occurs, I will need to determine if any revisions are needed to my goals, risk tolerance, allocation and management preferences and apply any of these changes to my investments. PRISM will make its return whenever something dramatic happens to me—I’ll keep you posted!

PRISM Step 4: Selecting and Managing Your Investments

Read the rest of my blog posts in this series here to learn more about how to use the AAII PRISM Wealth-Building Process!

PRISM is a five-step method for aligning my investment decisions with my goals, created by AAII Journal editor Charles Rotblut. The fourth step of PRISM focuses on how to find specific investments that fit my investing strategy.

Charles emphasizes the need for creating buy and sell rules for my investments. There are lessons containing helpful guidelines for buying and selling stocks, bonds, mutual funds and exchange-traded funds (ETFs). Thankfully, I have already been going about this process outside of PRISM, so I have a portfolio and some loose rules in place for the ETFs I own.

Using the list of Buy and Sell Rules for Mutual Funds and ETFs provided in the fourth step of PRISM, I solidified my portfolio rules.

The first question that caught my eye is related to the ETF’s investment approach. Since my investing strategy is to find sustainable ETFs that aren’t destroying the earth, this is an important consideration for my portfolio.

When I first invested in March 2022, I made notes of the ETFs’ current As You Sow grades in AAII’s My Portfolio tool so I knew why they were attractive investments at the time. As You Sow’s screener grades funds based on their investments in stocks of companies that are profiting from the fossil fuel industry, deforestation, gender inequality, sales of guns and military weapons, the prison industrial complex and tobacco.

During my first portfolio review at the start of 2023, I came up with some rules for my ETFs’ As You Sow grades: In order to add an ETF to my portfolio, it must have mostly grades of A and B—with the exception of gender equality, which can have a grade of C. I made this distinction after much in-depth research about sustainable investing and determined that gender equality is the most common holdout on these kinds of investments. The corresponding sell rule to this is if any of the ETF’s As You Sow grades worsens to C and/or the gender equality grade falls to D then the ETF’s sustainable objective is no longer valid for my portfolio strategy and it should be kicked to the curb.

The next guideline is regarding expense ratios. An expense ratio is the cost investors pay for a fund’s portfolio management. Since I am mostly investing in index ETFs, the expense ratios on my investments should be relatively low.

In my first portfolio review, I determined that I did not want to invest in an ETF with an expense ratio of 0.60% or higher. I also noted that I was looking for expense ratio grades of C or better, but I am now rethinking this rule. If my buy rule is for an ETF with an expense ratio below 0.60% and corresponding grade of A or B, the equivalent sell rule is if that expense ratio increases above 0.60% or its grade falls to C.

Below are my very official buy and sell rules:

As I continue my investing discoveries, I will add to this list and share it with you all. Follow along with me as I venture through the PRISM Wealth-Building Process and solidify my financial plan for the future!

New Year, New Investments, Same Strategy

It’s time for some more investing! I accumulated another lump sum of $2,000 to add to my Schwab brokerage account, but I’m not sure how to distribute it. I know I want to add some new investments, but should I sell some too?

During the first time I invested back in March 2021, I chose seven index exchange-traded funds (ETFs) that fit my personal environmental, social and governance (ESG) criteria. I started with AAII’s ETF Screener and filtered for socially responsible ETFs with low and below-average expense ratios in their category. From there, I added my investing ideas to AAII’s My Portfolio tracking tool and ran them through As You Sow’s screener, which grades funds based on their investments in stocks of companies that are profiting from the fossil fuel industry, deforestation, gender inequality, sales of guns and military weapons, the prison industrial complex and tobacco.

Unfortunately, the market took quite the fall last year, putting some of my klutziest moments to shame. Most of my initial investments have lost value since purchase, but I know that it’s not the end of the world. AAII taught me that bull markets last longer than bear markets, and by that logic there is hope!

This time, I started my search for new investments with a specific category in mind: vegan food. I found some vegan socially responsible ETFs through AAII’s ETF Screener but most of them had sky-high expense ratios. For instance, the VegTech Plant-Based Innovation & Climate ETF (EATV) has an expense ratio of 0.75%, giving it a category expense ratio grade of F. On As You Sow, it gets almost all A’s, with a B for gender equality. I’m looking for ETFs with expense ratios below 0.60%, but also with category grades of C or better. One vegan ETF that came close was the U.S. Vegan Climate ETF (VEGN)—it has a 0.60% expense ratio, putting it just above my limit, but it also has C grades for gender equality and the prison industrial complex on As You Sow, making it a less sustainable investment.

I decided to switch gears and use As You Sow’s screener to find sustainable investments at the source. I set the filters for grades of B or better for all categories except gender equality, since this is a common one that companies miss. I chose to go for C grades or better for gender equality since it’s something I’m willing to accept as long the grade doesn’t get worse.

This gave me a few more ideas to add to my index ETF list in the AAII My Portfolio tool: VanEck BioTech ETF (BBH), ClearBridge All Cap Growth ESG ETF (CACG), IQ Cleaner Transport ETF (CLNR), Global X Green Building ETF (GRNR), VanEck Morningstar ESG Moat ETF (MOTE) and Schwab U.S. REIT ETF (SCHH).

I recalled reading way back in Michele Cagan’s “Investing 101” that I shouldn’t have more than six or seven ETFs in my portfolio, because at that point there is likely to be some duplication that doesn’t do my portfolio any good. Since I currently hold seven ETFs, I will have to make a sell decision in order to add any new ones to my portfolio.

To determine if I even have something to sell based on my investing strategy, I evaluated my current investments on how their As You Sow grades fared over the last 10 months. When I first invested in the seven ETFs, I made notes of their current As You Sow grades in the My Portfolio tool so I knew what made them attractive when I bought them. With this analysis, I found that two ETFs were potentially on the chopping block: Defiance Next Gen H2 ETF (HDRO) and Fidelity Clean Energy ETF (FRNW). When I bought it, Defiance Next Gen H2 didn’t have a meaningful gender equality grade, but it has since changed to F, and its fossil fuels grade fell from C to D. Fidelity Clean Energy’s fossil fuels grade fell from B to C and its gender equality grade remains at D. I’m mainly basing my analysis on the fossil fuels grades falling, since these grades are more important to my strategy and gender equality will likely be the biggest uphill battle of sustainable investing.

So, I have my crops to harvest, but what will I be replacing them with? From the list of index ETFs I found this time around, VanEck BioTech graded best with all A’s on As You Sow, and CleanBridge All Cap Growth ESG and IQ Cleaner Transport received all A’s and B’s. Schwab U.S. REIT is also a contender with just a grade of C for gender equality dragging it down. If I choose to remove the two ETFs that no longer fit my investing strategy, I will likely add two new ETFs to fill their spots. This means I have to narrow down my list of potential ETFs. But how?

It’s time to take a look at sector diversification. Right now, I have a lot of industrials exposure with a few Global X ETFs, so I don’t want to add any more investments in that category. This means IQ Cleaner Transport is off the table. From here, I chose the two ETFs with the lowest expense ratios and expense ratio grades of A: VanEck BioTech with a 0.35% expense ratio and Schwab U.S. REIT with 0.07%! These will add exposure to the health and real estate sectors and further diversify my portfolio.

Though I now have some sell rules in place for my investments, I don’t have a schedule for evaluating them. I’m currently operating on a roughly annual basis, but with the ESG investing landscape in flux, it might make more sense to review my portfolio midyear as well.

I’ll keep you updated on how my investments fare in 2023!

I watched this so you don’t have to! Damon Dominique’s Finance Masterclass

“Some people are so poor, all they have is money.”
—Damon Dominique

Back in May, one of my favorite YouTubers Damon Dominique released a video titled, “A Finance Masterclass for Smart People Who Aren’t Interested in Money & Finance.” Instead of indulging in it immediately, I put it on my “Watch Later” playlist and let it sit there for five months with the intention of watching it, taking notes and sharing my thoughts with you all. At long last, I finally watched the video!

Damon is an American living in Paris, France, and is self-employed with a few different streams of income. He set up his own business so that he could write things off on his taxes as business expenses—like his laptop and his fancy pen. In this hour-long video, Damon discusses his “beef with finance,” working with accountants, the pros and cons of being self-employed, inflation, taxes, how rich people use money, brokerage accounts, capital gains, investment simulations, stocks and exchange-traded funds (ETFs), retirement accounts, lump-sum investing versus dollar-cost averaging, real estate, cryptocurrency, being an American living abroad, financial mindset and the philosophy of money.

Damon sees finance as a “topic that’s rather gatekeepery” and berates the U.S. public school system for not teaching us about taxes. I agree—why don’t we learn about taxes in school when that public education is funded by taxes? One thing I hadn’t realized is that when I eventually take money out of an investment, it gets taxed at a lower rate than income does.

Despite his sentiments around finance, Damon learned about it because it stressed him out and he wanted the “peace of mind” that comes when you understand money. He says, “Once you know how money works, you don’t have to worry about it anymore, because you can always make more.”

When discussing investing, he notes that even after learning about it he still sees it as gambling. However, he sees pretty much anything to do with money as a risk: “Which risk are you more comfortable with: Risking your money in a bank account, losing value to inflation” or losing it in the stock market? Either way, there’s a risk. It’s all about which risk you want to take.

My favorite segment was when Damon differentiated between stocks and ETFs with two different examples. The first is that he thinks vegan and plant-based food will “take off in the next 15 years.” But he doesn’t necessarily think one company will do better than the other (e.g., Beyond Meat will soar while Impossible Foods will tank); he thinks “the whole idea is gonna take off.” In comes the ETF, full of stocks and properly diversified to avoid one stock ruining his returns. The second example is an ETF as a box of vitamins. Damon says, “Maybe this one will make me throw up, but this one will make me feel really good!” As someone who has recently had multiple incidents with multivitamins making me vomit, this gave me a much-needed laugh! (I’m OK, but I will be leaving a bad review 😂)

Damon also offered a positive aspect of cryptocurrency that I hadn’t thought of—international payments. Since he lives in France but pays people from all over the world, he has run into issues with fees and taxes. Cryptocurrency as a potentially global currency would enable people to be “global citizens” and live and work from anywhere in the world without being tied to a specific place of residency.

While setting up his individual retirement account (IRA), Damon felt existential anxiety about how finance requires that we make these lifelong decisions about our money when we might not be ready or know what our lives will actually look like. Any plan is just a wild guess that we—and the planet—will be around and able to retire when the time comes. Though this is something that could give me more anxiety about money, the flip side is that since we have no control over what’s going to happen, it’s not worth staying up at night thinking about it!

One of Damon’s final points is to “prioritize the big wins” like using your great credit score to get a better loan from the bank when you want to buy a house instead of thinking about how much money you would save over time by not buying that $5 latte today. This is where so much press around millennials and avocado toast could be immediately squashed. Wealth ultimately isn’t about all of the things we didn’t buy so that we could save more, it’s about that balance between our lived experiences and the risks we take to live them.

Is Cannabis a Sustainable Investment?

In January 2020 when cannabis was legalized in Illinois, and even before then when states were rolling out their legislation, people were looking for a way to capitalize on the cannabis industry. I remember jokes flying around the AAII office about if we would ever have a featured speaker or writer on cannabis investments (giving buy low, sell high a whole new meaning!).

To put it bluntly, the main reason I’m not personally investing in cannabis is because there are still people in prison for it. I don’t believe I should profit from cannabis investments while people are wasting away in prison cells for something that is now legal for recreational consumption in 19 states and the District of Columbia.

But I still want to investigate if cannabis fits into a sustainable investing framework. I previously used As You Sow to find funds that are actually sustainable, not just labeled as such. So, let’s take a look at cannabis exchange-traded funds (ETFs) and see how they grade based on As You Sow’s criteria.

This article by AAII finance writer Matt Bajkowski briefly discusses the budding cannabis industry. Only one of the cannabis ETFs mentioned is available for As You Sow’s grades: Global X Cannabis ETF (POTX). Global X Cannabis gets grades of A for fossil fuels, deforestation, civilian firearms, prison industrial complex, military weapons and tobacco.


These grades made sense to me since cannabis investments represent a narrow slice of the overall stock market. Although I couldn’t get data on any other cannabis mutual funds or ETFs through As You Sow, I figured most of the results would be similar.

Even though the Global X Cannabis ETF got a grade of A for prison industrial complex, this just means that the ETF doesn’t directly invest in prisons. A broader view of the cannabis industry and who it affects directly and indirectly is important here. Along with a history of racism and the problematic words used to describe cannabis, including “marijuana,” there are still disproportionately more Black and Latino individuals in prison because of it.

In discussing the disparity in arrest rates, an article reported on the American Civil Liberties Union’s (ACLU) research, saying that “Despite roughly equal usage rates, Black people were 3.73 times more likely than white people to be arrested for marijuana.” In Iowa, Minnesota, Illinois and Washington, D.C., this difference increases to between 7.5 and 8.5 times more likely.

On the environmental side of things, it appears on the surface that cannabis is a sustainable industry. But a quick search revealed that there are concerns about the use of energy and water to grow cannabis plants. An article from Bloomberg on the environmental impact of cannabis noted, “cannabis plants suck up around twice as much water as maize, soybeans, wheat and wine grapes, according to a 2021 study in the Journal of Cannabis Research.” This could be ironed out as the industry grows, and as more efficient energy is sourced.

Like with any industry, some aspects will be green and others will be brown—as Larry Swedroe said in our interview with him about environmental, social and governance (ESG) investing earlier this year. Cannabis benefits people suffering from anxiety, post-traumatic stress disorder (PTSD) and depression. Legalizing cannabis also boosted the economy, created jobs and decreased crime in areas where people began drinking less alcohol in favor of cannabis.

The decision to invest in cannabis is entirely up to you. It doesn’t fit into my personal investing strategy, but hopefully as states continue to legalize cannabis for medical and recreational use, those who are wrongfully imprisoned will be released, and the industry can become even more regulated to ensure that cannabis can be grown and maintained sustainably.