Crossmark Large Cap Growth ETF Stock Price, News & Analysis

Crossmark Large Cap Growth ETF (CLCG) is an actively managed exchange-traded fund sponsored by Crossmark Global Investments. According to Crossmark, the fund is built around a values-based investment approach and is designed for investors who want exposure to the large cap growth segment of the U.S. equity market while incorporating faith-based screening criteria.

Fund objective and strategy

The Crossmark Large Cap Growth ETF seeks long-term capital appreciation. As described in Crossmark’s public materials, the portfolio managers aim to identify high-conviction securities through a combination of fundamental and quantitative analysis, values-based criteria, portfolio constraints, and risk management tools. The fund is managed to seek outgrowth of the Russell 1000 Growth Index, which measures the performance of large cap U.S. companies with relatively higher growth characteristics.

The ETF is classified as non-diversified under the Investment Company Act of 1940, meaning it may invest in securities of relatively few issuers. It focuses on large cap companies and growth stocks, and its performance is influenced by equity market risk and selection risk, as is typical for equity investments.

Values-based and faith-based approach

Crossmark Global Investments describes itself as a faith-based investment management firm that creates and manages values-based investment strategies. For CLCG, the firm applies an exclusionary and inclusionary screening process. The exclusionary screens remove companies that Crossmark identifies as having negative business practices or corporate governance concerns. The inclusionary screens allow the fund to actively include companies that, in Crossmark’s view, work to reduce risk and build long-term resilience through responsible business practices.

The firm notes that these values-based screening policies can affect the fund’s investable universe. For example, excluding certain securities may cause the fund’s performance to differ from strategies that do not use similar screens, and divesting from a company that is later found to violate screening criteria can result in realized losses.

Management and investment process

Crossmark states that the Crossmark Large Cap Growth ETF is managed by an experienced team that uses both fundamental and quantitative factors in security selection. The investment adviser applies investment techniques and risk analyses when constructing the portfolio, while acknowledging that there is no guarantee these methods will achieve the desired results.

The fund’s process also incorporates positive value characteristics, based on data and rankings from third-party providers unaffiliated with the adviser. Crossmark notes that such information may be unavailable or unreliable at times, and that investors can differ in their views of what constitutes positive value characteristics. As a result, the fund may invest in issuers that do not reflect or support the values of every individual investor.

Relationship to Crossmark’s broader strategies

Crossmark indicates that the Crossmark Large Cap Growth ETF is intended to mimic the investment strategies used in separately managed accounts run by the same team. The launch of CLCG, alongside the Crossmark Large Cap Value ETF, represents Crossmark’s entry into the ETF market, offering a transparent ETF wrapper for its existing values-based, actively managed strategies.

Crossmark Global Investments was founded in 1987 and positions itself as a firm that develops tailored values-based investment solutions for financial intermediaries and their clients. It is indirectly owned by a non-profit organization, and Crossmark states that its net income supports multiple ministry programs.

Key risks and considerations

Crossmark highlights that an investment in the Crossmark Large Cap Growth ETF involves risk, including possible loss of principal. The fund is subject to equity market risk, selection risk, and risks associated with large cap companies and growth stocks. Because it is actively managed, the fund is also subject to management risk, meaning that the adviser’s techniques and analyses may not produce the intended results.

As an ETF, CLCG trades on an exchange like a stock, and its market price may fluctuate above or below its net asset value (NAV). Brokerage commissions and fund expenses can reduce investor returns. Crossmark notes that ETFs are subject to specific risks depending on their underlying strategy, and that CLCG may be affected by factors such as market disruption and geopolitical risk, inflation risk, issuer risk, small and mid-cap exposure through underlying holdings, other investment companies or real estate investment trust risk, focus risk, concentration policy risk, market price risk, small fund risk, and authorized participant concentration risk, as described in its prospectus.

Crossmark emphasizes that past performance does not guarantee future results and that investors should carefully review the fund’s prospectus or summary prospectus for a full description of objectives, risks, charges, and expenses before investing.

Benchmark context

The Russell 1000 Growth Index, referenced by Crossmark as the benchmark CLCG seeks to outperform, measures the performance of the large cap growth segment of the U.S. equity universe. It includes Russell 1000 companies with relatively higher price-to-book ratios, higher forecast medium-term growth, and higher historical sales-per-share growth. While CLCG is actively managed and does not attempt to replicate this index, the benchmark provides a frame of reference for the fund’s investment universe and growth orientation.