Today, a company called FaithShares launched two new religion-based Exchange Traded Funds that will invest in Wall Street companies. An ETF is basically a basket of stocks. The Baptist Values Fund and the Lutheran Values Fund join a line up of ETF’s that also target Catholics, Methodists and Christians in general.

Here’s an excerpt from the company’s press release:

“We created these funds to meet the needs of investors who want to participate in the potential of the stock market, yet be good stewards of their money,” said Thompson S. Phillips Jr., President of FaithShares. “As an ETF, each of our funds will include 100 stocks of large, well-known companies but specifically exclude those considered to be ‘objectionable industries’ by a specific denomination.”

Those objections differ from fund to fund. If you invest in the Baptist Values Fund, you won’t get companies involved in the following activities: abortion, alcoholic beverages, gambling, tobacco, military weapons and pornography.

The Lutheran Fund has a different tolerance level: No liquor, but beer and wine are fine. No gambling, no nuclear, biological or chemical weapons. Guns are okay. No porn. No tobacco.

The Catholics have a different weapons policy — no companies that derive greater than 5% of revenues from firearms or military weapons. And of course, zero tolerance for abortion, but also contraceptive products. That leaves out the plastics industry I guess.

It’ll be interesting to see how these funds do. They’re limiting their diversification by design, but Daily Finance points out that narrowing the field is a way to find companies that are thinking socially:

… using socially responsible investing (SRI) criteria is no longer simply a form of activist investing, but a way to pick companies that have long-term focus and strong risk management, as measured by their environmental, social and governance (ESG) practices, points out Eric Lybarger, principal of Evergreen Global Investment Group. “As global stock exchanges, like NYSE Euronext, make ESG information readily available to investors, ETF companies will likely create more offerings around different ESG criteria,” he adds.

What, like maybe the ABB fund (Anybody But the Banks)? Or how about a fund with zero tolerance for bailed-out companies?

Anyway, Lybarger says because of the narrow focus, you wouldn’t want to make one of these ETF’s the core of your investment strategy.

Learn more about each of the new funds here. By the way, a tithe of 10% of net income will go to ministries associated with the respective denominations.

What do you think? Do religion and Wall Street mix?