RECENTLY, Business News personal finance writer Mark Beyer, wrote about the growth of ethical funds in Australia.
RECENTLY, Business News personal finance writer Mark Beyer, wrote about the growth of ethical funds in Australia.
Now we can present to you the startling revelation that there are funds which put your money in life’s “true” fundamentals, alcohol, tobacco, casinos, con-doms and girlie magazines.
In fact there is now an index, created by Credit Suisse First Boston, called the “Vice Squad” that consists of about 20 industry groups, including gaming, airlines, hotels, autos, tobacco, drugstores, and alcoholic beverage stocks.
Back in the heady ’90s, apparently, these fun funds were relatively plentiful. However the only true sin fund left is Morgan Funshares.
This closed-end fund was first launched in 1994. The founder and manager, Morgan Burton, now in his 80s said that he wanted an antidote to the growing socially responsible investing trend.
The Morgan Funshares advertising also supported this by showing Morgan among women with copious amounts of alcohol around him.
The top holdings in the Morgan Funshares are AOL Time Warner, Johnson and Johnson, Bristol-Myers Squibb, Philip Morris and Coca-Cola.
Some of the other stocks that the fund holds are Harrah’s Entertainment (a casino operator), Anheuser-Busch (a brewer) and Carter-Wallace (the world’s largest condom manufacturer.
The performance of the fund is reasonable, delivering 9.29 per cent per annum for the past five years.
This year has been a tough one for most American funds. It has dealt the Morgan Fund a negative return of 10.71 per cent. By comparison, the S&P 500 is down 10.50 per cent.
Morgan’s philosophy in this fund is simple. He tries to invest in habit forming small ticket items that people can’t live without.
He makes the point that while this includes tobacco and liquor, they are not the only products.
The No.1 habit-forming commodity is toilet paper, which explains the holding in Kimberly-Clark.
Aside from this “sin” fund, there are leisure funds. These tend to invest in media, manufacturers and distributors of beverages and food, tobacco products, toiletries and cosmetics, health-care products, toys, casinos, sporting goods, race tracks, movies and amusement parks.
The Fidelity Select Leisure fund has an annualised return of 18.31 per cent per annum. It holds stock in Disney Holdings, Seagram, travelocity.com, McDonald’s, Anheuser-Busch, Gillette, Harley-Davidson Carnival and Playboy Enterprises.
However, in a market that looks increasingly like being in recession, this type of fund could struggle. The reduction in disposable income available to most of us will mean that some of life’s “little luxuries” may well be the first casualties.
Now we can present to you the startling revelation that there are funds which put your money in life’s “true” fundamentals, alcohol, tobacco, casinos, con-doms and girlie magazines.
In fact there is now an index, created by Credit Suisse First Boston, called the “Vice Squad” that consists of about 20 industry groups, including gaming, airlines, hotels, autos, tobacco, drugstores, and alcoholic beverage stocks.
Back in the heady ’90s, apparently, these fun funds were relatively plentiful. However the only true sin fund left is Morgan Funshares.
This closed-end fund was first launched in 1994. The founder and manager, Morgan Burton, now in his 80s said that he wanted an antidote to the growing socially responsible investing trend.
The Morgan Funshares advertising also supported this by showing Morgan among women with copious amounts of alcohol around him.
The top holdings in the Morgan Funshares are AOL Time Warner, Johnson and Johnson, Bristol-Myers Squibb, Philip Morris and Coca-Cola.
Some of the other stocks that the fund holds are Harrah’s Entertainment (a casino operator), Anheuser-Busch (a brewer) and Carter-Wallace (the world’s largest condom manufacturer.
The performance of the fund is reasonable, delivering 9.29 per cent per annum for the past five years.
This year has been a tough one for most American funds. It has dealt the Morgan Fund a negative return of 10.71 per cent. By comparison, the S&P 500 is down 10.50 per cent.
Morgan’s philosophy in this fund is simple. He tries to invest in habit forming small ticket items that people can’t live without.
He makes the point that while this includes tobacco and liquor, they are not the only products.
The No.1 habit-forming commodity is toilet paper, which explains the holding in Kimberly-Clark.
Aside from this “sin” fund, there are leisure funds. These tend to invest in media, manufacturers and distributors of beverages and food, tobacco products, toiletries and cosmetics, health-care products, toys, casinos, sporting goods, race tracks, movies and amusement parks.
The Fidelity Select Leisure fund has an annualised return of 18.31 per cent per annum. It holds stock in Disney Holdings, Seagram, travelocity.com, McDonald’s, Anheuser-Busch, Gillette, Harley-Davidson Carnival and Playboy Enterprises.
However, in a market that looks increasingly like being in recession, this type of fund could struggle. The reduction in disposable income available to most of us will mean that some of life’s “little luxuries” may well be the first casualties.
