Friday, May 30, 2014

God-honoring and Bible-based Christian Mutual Funds

When we stand before the Lord, we will have to give an account for our use of money, along with everything else.  All we have really does not belong to us, but is a stewardship we have from God. Scripture represents an abuse of financial stewardship as a serious sin (cf. James 5:1-5Matthew 25:14-30).  Do you own mutual funds (and, therefore, are you part owner of) companies that promote or support abortion, pornography, moral perversions like sodomy, or ungodly entertainment, alcohol, tobacco, or gambling? If you do, you are partaker of the sins of these companies.  Do you not know if your investments are clean?  Find out here:
What options do Christians have for investing in mutual funds?  The best option is:
Eventide produces the only mutual funds I can recommend without reservation. They filter out the bad companies, like the Timothy Plan (discussed below) also does, but they are better.  While both the Timothy Plan and Eventide Funds filter out companies that support abortion, pornography, immorality, ungodly entertainment, alcohol and  tobacco manufacturers, and gambling, the Timothy Plan only gets rid of manufacturers of alcohol and tobacco (e. g., brewery companies) while Eventide avoids retailers also (e. g., supermarkets and restaurants that sell alcohol). Eventide thus avoids the woe God pronounces on those who distribute alcohol in Habakkuk 2:15.  Eventide also goes beyond avoiding companies that do evil to seek out and invest in companies that do positive good.  Thus, while both the Timothy Plan Funds and the Eventide Funds are far, far better than secular mutual funds, Eventide is #1, and the Timothy Plan is #2 in terms of Biblically responsible investing.
I contacted Eventide to make sure that my comments about them, and my comparison of their Funds with those of the Timothy Plan, were accurate.  The following is the reply I received (slightly edited):
[W]e appreciate your support!  Your description of us is accurate.  In the past we’ve used the following description of our process:
Many socially responsible and faith-based funds merely focus on the negatives: avoiding companies that produce tobacco or pornography, for example. While this is an important part of Eventide’s process as well (such not investing in companies that support pornography, tobacco, abortion, gambling, violent video gaming, or environmentally irresponsible actions), Eventide goes a step further and asks even more thoughtful questions about integrity, business practice, and value-creation. For example, the Eventide Gilead fund avoided banks in 2008 because of concerns about exploitation — concerns that unfortunately proved to be well founded in retrospect. Positively speaking, Eventide is invested in companies developing the next generation of drugs to treat diseases like anemia or Lou Gehrig’s disease. Eventide strives to provide its investors with the pride in knowing that their money is with not merely successful companies, but admirable companies.
In general, we focus on the profit centers of businesses when evaluating them for investment, and seek companies that excel at value creation for all their stakeholders — customers, employees, supply chain, communities, environment, and society.  Importantly, we also avoid investing in companies that engage in predatory behavior or seek profit above all else (such as those in the above description).
One comment, while your description of us is accurate, we are very supportive of the Timothy Plan.  We feel that it’s essential that Christians be made aware that stock investing — in any form — is really company ownership, conferring ethical responsibility to investors, and therefore Christians should seek to own only those companies aligned with God’s purposes in the world.  We feel that the Timothy Plan provides great value for investors seeking to avoid investing in companies that harm others and thereby dishonor God.

Based on the investment principles of Eventide, I enthusiastically support and recommend their mutual fund family.  Furthermore, while I would be willing to accept a lower rate of return for Biblical filters, Eventide has consistently posted a fantastic rate of return, beating the large majority of related secular and unfiltered mutual funds!   Learn more or purchase Eventide Funds here.
 I also agree with Eventide in being happy about the existence of the Timothy Plan.  According to their brochure, the Timothy Plan Funds filter out:
1.) Abortion:
a.) Manufacturers
b.) Hospitals
c.) Insurance Companies
d.) Contributors
e.) Researchers
2.) Pornography
a.) Producers
b.) Publishers
c.) Distributors
d.) Internet
e.) Facilities
3.) Anti-Family Entertainment
a.) Producers
b.) Advertisers
c.) Promoters
4.) Unbiblical “alternative’ lifestyles:
a.) Financial Support
b.) Employee Groups
c.) Active Involvement
5.) Alcohol
a.) Manufacturers
6.) Tobacco
a.) Manufacturers
7.) Gambling
a.) Manufacturers
b.) Facilities
c.) Equipment

These filters–which Eventide also employs–are fantastic, and make the Timothy Plan mutual funds far superior to secular mutual funds that will almost certainly contain companies that support these types of wickedness. However, the Timothy Plan Funds do not filter out alcohol and tobacco retailers.  When I asked them about this matter, they indicated that they had no plans to add such a filter in the future.  For that reason, I cannot recommend believers purchase their stock funds. You ought not be a part-owner of companies that retail alcohol and tobacco, lest you become a partaker of the sins of those who displease God by consuming these ungodly substances, die from using them, kill others in drunken driving crashes, etc.  I believe that the Timothy Plan non-stock funds, however, can be owned with a pure and Biblically-grounded conscience.  For instance, their High Yield Bond Fund employs all the filters above, but by owning it you are only lending money to, say, Walmart, instead of directly owning the company.  If Israel could lend money to the heathen (Deut 15:628:12), then it is certainly Biblically justifiable to own bonds with Timothy Plan filters.
 In conclusion, then, if you own secular mutual funds, you are almost certainly supporting practices that cannot by any means be justified Biblically.  The Biblical principles of both the Timothy Plan and Eventide Funds are vastly superior to the disregard of the Lord by secular mutual funds;  however, because Eventide eliminates retailers of alcohol and tobacco, while the Timothy Plan does not, the Eventide Funds are the only ones that can be unconditionally endorsed.  Only the non-stock Timothy Plan funds can be justified in light of Habakkuk 2:15.  I personally own both the Eventide Gilead Fund (ETGLX) and the Eventide Health Care and Life Sciences Fund (ETNHX) as well as the Timothy Plan High Yield Bond Fund (TPHAX).  Finally, I also believe that peer-to-peer lending is a good investment which can be done with Christian principles–find out more about this potentially high-yield investment here.
Of course, I am not giving you official financial advice.  I cannot predict the future, other than that the Lord Jesus is going to come back at some point and everything God’s Word says about the future is going to happen.  The Bible says that riches are uncertain (1 Timothy 6:17).  I cannot guarantee that any mutual funds or other investments will go up instead of down.  Trust in Jesus Christ, not in them.  I am saying, however, that Scripture is clear that God will judge our stewardship of the resources He has given us, and that investing–and all other areas of life–must be done to the glory of God (1 Corinthians 10:31).  May the information above help you as you seek to glorify God with the financial resources He has entrusted to you.
Note that I have also posted this article here.

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