ETFs Loaded With Political Donors (EIS, XLE)
With campaign season in full swing, candidates and voters alike are reminded that running for president in this country is an expensive task. Just one month of fund raising statistics highlights the exorbitant costs associated with becoming the leader of the free world.
In June, President Obama's team raised $71 million, according to ABC News. Sounds impressive, until one compares that $71 million against the $106 million raised by Republican Challenger Mitt Romney.
Candidates, the national committees and political action committees are highly dependent on large contributions from wealthy individuals and corporations that need and want friends in Washington. With Election Day less than five months away, it is time to take a look at some ETFs that are chock full of political donors.
iShares MSCI Israel Capped Investable Market Index Fund (NYSE: EIS) The inclusion of the iShares MSCI Israel Capped Investable Market Index on this list is a surprise for two reasons. First, it is obviously a country-specific ETF tracking a country that is not the U.S. Second, U.S.-born employees of companies found in EIS might show themselves to be big donors to the Romney campaign and that is the real surprise.
More than three-quarters of Jewish voters in the U.S. voted for President Obama in 2008, according to U.S. Today. However, Romney is holding a high-dollar fundraiser in Israel later this month. Those that want to attend will be asked to fork over a minimum of $60,000 per plate to enjoy dinner with the former Massachusetts governor.
iShares Dow Jones US Broker-Dealers Index Fund (NYSE: IAI) When he campaigned for the nation's highest office in 2008, then-Senator Obama was the toast of Wall Street, easily plucking campaign cash from an array of investment banks and other financial services firms. Fast-forward to 2012 and it does not appear likely that the President will repeat that fundraising prowess on Wall Street.
Combine the Dodd-Frank legislation with several years of unsavory rhetoric aimed directly at the Wall Street crowd and it is easy to see why there might be some buyer's remorse among finance types regarding President Obama.
Not to mention, Romney is a former private equity executive. In theory, many Wall Streeters should be able to identify more with Romney than the President. In reality, that scenario appears to be playing out. At the end of May, Romney had raised $22 million from banks, insurance and real estate firms, more than double what the President had hauled from those type of firms, according to Reuters.
Technology Select Sector SPDR (NYSE: XLK) Two of the top five donors to the Obama re-election effort are Microsoft (NASDAQ: MSFT) and Google (NASDAQ: GOOG), according to OpenSecrets. The two tech giants account for more than 13 percent of XLK's weight. Through mid-June, the biggest tech sector contributor to the Romney campaign was Massachusetts-based EMC (NYSE: EMC), another XLK constituent.
Apple (NASDAQ: AAPL) cannot be left out of the conversation, either. The world's largest company by market value and XLK's largest holding with a weight in excess of 20 percent, sees some of its employees donate far more to Democrats than to Republicans.
Energy Select Sector SPDR (NYSE: XLE) The lopsided way in which the energy sector doles out political contributions is no surprise. Oil and gas companies gave $1.45 million in direct contributions to Romney in 2011 and 2012 while giving just $250,000 to President Obama, The Hill reported.
As has been the case with major banks, some oil companies have been on the receiving end of less-than-kind rhetoric from the President. Throw in the moratorium on offshore drilling following the Gulf of Mexico oil spill in 2010, and it is not unreasonable to consider any donation from the oil industry to the President "token" at best.
It is not just the likes of Exxon Mobil (NYSE: XOM) and Chevron (NYSE: CVX) that lean Republican when it comes to political donations. Continental Resources (NYSE: CLR) CEO Harold Hamm has given $985,000 to the pro-Romney super PAC Restore Our Future. Hallador Energy (NASDAQ: HNRG), a Colorado-based small-cap coal producer, has also contributed to Restore Our Future.
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