Timothy Plan US Small Cap Core ETF (TPSC) seeks to track small-capitalization U.S. stocks while applying faith-based screening criteria that exclude companies involved in activities conflicting with biblical values. This socially responsible small-cap equity ETF provides exposure to smaller American companies that pass both financial and moral screening requirements.
How It Works
TPSC uses a passively managed approach that starts with a small-cap universe and applies negative screening to exclude companies involved in abortion, pornography, anti-family entertainment, non-married lifestyles, alcohol, tobacco, and gambling. The remaining qualifying small-cap stocks are weighted by market capitalization. The fund rebalances quarterly to maintain index alignment and screening compliance. Holdings typically include 200-400 small-cap companies that meet both financial size requirements and Timothy Plan's biblical screening criteria.
Key Features
- Combines faith-based ESG screening with small-cap exposure, excluding companies in alcohol, tobacco, gambling, and other biblically-objectionable industries
- Zero expense ratio makes it one of the lowest-cost socially responsible small-cap ETFs available to investors
- Managed by Timothy Plan, a pioneer in biblically responsible investing since 1994 with established screening methodology
Risks
- This ETF can lose value when small-cap stocks underperform, potentially declining 40-50% during market downturns as smaller companies face higher volatility
- Faith-based screening significantly reduces the investment universe, potentially excluding profitable companies and creating concentration risk in remaining sectors
- Small-cap stocks historically experience greater price swings than large-caps, with potential for extended periods of underperformance relative to broader markets
Who Should Own This
Best suited for faith-based investors with 5+ year time horizons seeking small-cap exposure aligned with biblical values. High risk tolerance required due to small-cap volatility. Works as satellite holding (5-15% of equity allocation) for investors prioritizing values-based investing over maximum diversification in retirement or taxable accounts.