It’s been long known that morals and money-making often clash. But for those looking to invest, and not necessarily make principled investments, “sin” stocks may be the best option out there, as seen by the performances of tobacco and alcohol companies in the stock market.
The Financial Times reports that a study for Credit Suisse produced by Elroy Dimson, Paul Marsh and Mike Staunton of London Business School, showed that brewers and distillers have been the best-performing British shares since 1900. However, American alcohol stocks have not performed as well thanks (again) to Prohibition. Instead, tobacco has been the best performing industry in the U.S. when it comes to the stock market.
Professor Dimson attributes the strong performance of these two sectors to be twofold, as not only are the products addictive, but the refusal of ethically minded investors to buy the shares allows a higher return for those who have invested.
CNBC also observes that ethical investments have grown in recent years, since more and more investors are concerning themselves with the source of income in their portfolios, and “sin” stocks certainly don’t meet the UN-supported Principles for Responsible Investment. [Financial Times] [Photo: Flickr.com/methticalman]