An ETF That Tracks Employees' 'HAPI'-Ness

Summary

Bloomberg ETF IQ's Drill Down focuses on the Harbor Human Capital Factor US Large Cap ETF (HAPI), which screens S&P 500-like large caps based on employee happiness. Eric Balchunas highlights its low tracking error, 35 basis point fee, roughly $500 million asset base, and historical outperformance versus the S&P 500. Guest David van Adelsberg explains Irrational Capital's method for quantifying intrinsic employee motivation and cites JP Morgan research validating the human capital factor. The discussion also touches on AI automation versus augmentation and why Tesla and Amazon are excluded or underweighted.

• The segment reviews HAPI, a Harbor ETF that tracks employee happiness as an investment factor.
• Eric Balchunas notes low tracking error, a 35 basis point fee, and roughly $500 million in assets.
• HAPI has outperformed the S&P 500 with limited additional risk, according to the segment.
• David van Adelsberg says Irrational Capital uses a 20-year dataset and annual rankings to quantify intrinsic employee motivation.
• JP Morgan research is cited as finding the human capital factor has strong risk-adjusted returns versus other styles.
• Tesla and Amazon are excluded or underweight because employees are less happy there.
• The guest argues AI job displacement fears are overblown and distinguishes automation from augmentation.
• No separate small-cap fund or specific AI trade was named.