Exchange-traded fund CHAI donates all profits to Magen David Adom

The new CHAI Exchange-Traded Fund (ETF) will contribute 100% of its profits to Magen David Adom, The Jerusalem Post has confirmed.

"In honor of the CHAI ETF launch, we are proud to contribute to Magen David Adom for their amazing work," Defiance Investments Chairman Matthew Bielski told the Post.

Defiance, an American ETF firm, and Migdal Capital Markets (MCM) launched the first Israel Bond ETF in mid-December.

The ETF trades under the "CHAI" ticker on the New York Stock Exchange and tracks the MCM-BlueStar Israel Bonds Index. 

What is CHAI?

The fund predominantly invests in Israeli government and corporate bonds in dollars and shekels, providing liquid access to these bonds for all investors – especially Jewish investors in the United States. 

The name "CHAI" was selected before the October 7 Hamas massacre but has taken on new meaning since the start of the war, said Dr. Yossi Shvimer, CEO of MCM Alternative Investments. 

"Chai is life," Shvimer said. "It is Am Yisrael chai [the nation of Israel lives] – and something we always think about."

Shvimer explained that BlueStar created the index, and MCM is the fund adviser. The fund includes around 30 bonds, including some fixed-income and corporate bonds, such as from TEVA and Amdocs.  

Bielski said there was "huge interest" from hedge funds to invest directly in Israel bonds, and the new ETF offers a solution. 

But is it a good time to invest in Israel?

"Israel's GDP should recover fast," Shvimer predicted. "The Israeli market is quite resilient from what we have seen in past wars."

He noted that the Bank of Israel's decision to cut the interest rate at the beginning of the week - the first such cut since March 2020 and the first in any country in 2024 – was "part of the resilience we have here."

Shvimer noted that with the rate cut, the bank kept the growth forecast for 2023 and 2024 at 2% but predicted 5% growth in 2025.