There's an ETF for That? Funds with a Social Impact

Bond ETFs That Finance Underserved Communities

Rather than owning the equities of companies that are attempting to make a social impact, investors can instead provide capital to pools of loans that serve disadvantaged or historically underserved communities. In doing so, the ETF continues to provide income like a conventional bond fund, but the underlying mortgages and loans are directed toward specific social objectives.

One example is the CCM Affordable Housing MBS ETF

, offered by Community Capital Management. According to the firm, the ETF is designed as a capital markets solution for "bridging the racial wealth gap" while helping address the affordable housing shortage in the United States.

The ETF invests at least 80% of its assets in mortgage-backed securities (MBSs) backed by pools of residential mortgage loans meeting one or more of four criteria: loans to low- and moderate-income, workforce, or minority borrowers; loans located in racially or ethnically concentrated areas of poverty; loans in persistent poverty counties; or loans within majority-minority census tracts.

Despite its social mandate, OWNS remains a fairly conventional mortgage-backed securities ETF. It is benchmarked against the Bloomberg U.S. MBS Index, charges a gross expense ratio of 0.68% that is currently waived to 0.30%, launched in July 2021, and has grown to approximately $104 million in assets under management. As of the latest data, it offers a 4.07% 30-day SEC yield.

A similar concept, albeit serving a different community, is the Academy Veteran Bond ETF

. Launched in 2022, VETZ is an actively managed mortgage-backed securities ETF benchmarked against the Bloomberg U.S. MBS Index. The ETF charges a 0.35% expense ratio, manages approximately $124 million in assets under management, and currently offers a 4.58% 30-day SEC yield.

Its portfolio is backed by loans made to U.S. military service members, veterans, surviving spouses, and veteran-owned businesses. That includes pools of VA-guaranteed home loans, which help eligible veterans purchase homes with more favorable financing terms, as well as Small Business Administration (SBA) loans that support veteran entrepreneurs seeking to start or expand businesses.

The social impact extends beyond the portfolio itself. Academy Asset Management has long supported initiatives that help military veterans transition into civilian careers, including mentoring and introducing veterans to careers on Wall Street and within the broader financial services industry.

Equity ETFs That Donate a Portion of Their Revenue to Charity

Another way ETFs can create a social impact is by directing part of their own revenue toward charitable causes. Normally, an ETF's expense ratio compensates the issuer for services such as portfolio management, administration, marketing, compliance, and distribution.

 A handful of funds, however, have made an explicit commitment to donate a portion, or in some cases all, of their net profits to nonprofit organizations. One of the best-known examples is the Simplify Health Care ETF

, managed by Michael Taylor.

According to Simplify, PINK is the industry's first 100% pro bono ETF, with all net profits donated to benefit the Susan G. Komen Foundation and its efforts to combat breast cancer. As of June 30, 2026, Simplify reports that the fund has contributed more than $450,000 to the organization.

PINK is an actively managed healthcare equity ETF charging a 0.51% expense ratio. Despite the higher fee, the strategy has so far outperformed comparable passive healthcare sector ETFs from both iShares and Vanguard by a comfortable margin.

Part of that advantage stems from the manager's flexibility. Rather than closely hugging a healthcare benchmark, Taylor has the discretion to invest outside the largest pharmaceutical companies and allocate more heavily toward mid- and small-cap businesses operating in faster-growing areas such as biotechnology, medical technology, and gene therapy.

A newer example comes from ETF entrepreneur Rob Oliver through the U.S. Defense ETF

. At a 0.45% expense ratio, the fund passively tracks a selective U.S. defense index spanning four themes: defense systems and military platforms; defense technology; defense logistics, simulation, and mission support; and cybersecurity and digital defense infrastructure.

The index currently holds 50 companies that derive at least 50% of their revenue from one or more of those areas while also meeting listing, market capitalization, and liquidity requirements. Diversification rules are also built into the methodology. Individual holdings are capped at 8%, cybersecurity companies at 3% each, total cybersecurity exposure cannot exceed 25%, and the combined weight of positions above 5% cannot exceed 40%.

The charitable component is what sets DUTY apart. As sponsor of the ETF, Aura ETFs has committed to donating 10% of the fund's revenue to charitable organizations supporting U.S. military veterans during its first year of operation. Regardless of how much the ETF ultimately gathers in assets, the firm has pledged a minimum donation of $150,000 in the first year of operation.

Please note that this article reflects the author’s personal views and does not represent the opinions of the publication or its affiliates. It is for informational purposes only and does not constitute investment advice. It is essential to seek guidance from a registered financial professional before making any investment decisions.