|Here’s a new twist to the concept of socially responsible investing: socially irresponsible investing. |
A new mutual fund, called the Vice Fund, invests in so-called sin stocks – gambling, alcohol, tobacco and defense.
“We're not out there to do nothing but socially irresponsible investing, but the point of investing is to make money. ... That means investing in those markets that do well,' said portfolio manager Eric McDonald, co-manager of the fund with Dan Ahrens.
Abraham Lincoln famously came up with the quip: 'It has been my experience that folks who have no vices have very few virtues.' That quote is proudly displayed on the Vice Fund's promotional web site along with the portfolio's motto: 'When it's good, it's very, very good. ... When it's bad, it's better.' As mission statements go, it’s surely one of the more honest ones.
Companies under consideration for the portfolio are signature sin stocks:In tobacco, Philip Morris ; in defense, Raytheon, Boeing and General Dynamics; and, in gambling, Harrah's and MGM Mirage. The new fund is the latest product from investment adviser and mutual-fund broker Mutuals.com.
Mutuals.com isn't the first to offer such funds. Several years ago, Burt Morgan opened the Morgan SinShares fund with the idea of investing in anything habit-forming. He later changed the name to Morgan Funshares at the urging of old friend and noted investor Sir John Templeton -- a man well-known for his religious convictions.
'They'll never make it, because they'll find out what I did,' Morgan said of the new Vice Fund. 'Sin isn't sellable, but fun is -- but let them find out the hard way. Don't tell them.'