We’ve given a fairly decent overview of the key differences between socially responsible investing vs sin stocks in the previous chapters of this series.
For our closing entry on this current subject, a careful eye will be cast upon these stock options. We’ll look at them from the widest perspective, and then we’ll summarize investment strategies.
Socially Responsible Investing – Stock Options Galore
Socially responsible investing (SRI) is recognized as being a field where even the most noble pursuits can be tarnished by ineffective or dishonest practices. However, wicked companies are often the exception and not the rule as having to compete in the industries that fall into the SRI camp is a challenging prospect.
Not only are the fields governed strongly by productivity, but they’re also very broad, making SRIs some of the most expansive stock options out there. Having numerous options and investing in multiple companies provides strength to a portfolio.
Sin Stocks – Limited Stock Options
Sin stocks are where a lot of cash can be made if the quest for success is just done with profit in mind. You can find companies whose markets never run out – alcohol and tobacco being two of them. However, these stocks suffer from the bad image they have in society, and the companies that provide the investment choices under sin stocks are often under fire by both social activists and government politicians. This is really true regarding firearms.
Whatever the case may be, investing in a sin stock is a chance taken with the cultural tides of the moment, and you can find your profits drop or rise based on how people feel. Also, there are very few sin stock options, perhaps less than a dozen – so you don’t get many choices to broaden your portfolio.
In the end, investing in either of these depends on your stance and perspective. If you simply won’t tolerate sin stocks, then the choice you can make regarding stocks has basically already been made for you. However, you still need to carefully screen the quality of your stocks in terms of performance and personal value. If you don’t mind investing in sin stocks, then that can only add to the diversification of your portfolio, if you choose to include both types of stock.
Thanks for taking the time to read this series. We hope it really helped you understand some of the investment choices and stock options that are available to you! Stick around for our next series, and stay sharp out there!
Sean Rasmussen
The Bullhunters Guide
Universal Wealth Creation © 2004 – 2010
{ 8 comments… read them below or add one }
G’day Sean,
Thanks for this great series. Doing Options trading at present with Halifax and enjoying it – especially when the trade is profitable. Hasn’t been too good over the last few weeks, but there is a real move afoot in the market now. This is where Accentuating the Positive and persisting with trading pays off.
Not at all keen on ” sin ” stocks as you call them, and refuse to be part of tobacco, alcohol or firearms in any form. Excuse me while I polish my halo !!!
Looking forward to the next Bullhunter episode !
Cheers
Harry
Like me, there are many people who aren’t keen on sin stocks Harry, each to their own I guess. Great to hear you are enjoying your investing mate, all the best!
You have really a interest own posting style and offer good information. The articles are nice to read and you don´t use a lot of ads like all the other bloggers…
Glad to hear you like it Kilian, cheers
I was just thinking to myself how unique this little series of Sean’s is. I can’t say I have seen other blogs from marketers highlighting these types of issues.
Oh, I am sure many of them are good and honorable guys – but do they obviously mix their intgerity in their business the way Sean does? Not to my knowledge. I mean there is no financial or marketing benefit for Sean to publish articles like these, but he does ….. and that is what sets him apart from many of his peers, and, also reassures we, his readers, of his basic integrity.
Integrity is a good word to use here Peter.
If we are in integrity, we would not purchase ’sin’ stocks. If we are out of integrity, we can sometimes justify to ourselves that we are not but our actions reveal otherwise.
I have a philosophy that the measure of your integrity is the impression you leave on someone else.
Others will be the judge of this, not you.
That’s a good philosophy Elly. There has to questions asked before we consider any stocks – as to whether they are SRI or SIN …. unless all that matters is money, money, money!
I would find it hard to buy into any company that is exploitive as well – e.g. big brand clothing companies that employ Asian compnaies to manufacture clothes which are sold overseas – here, the US etc, at high prices, yet pay less than subsistence wages to the workers.
Hi Sean,
There has to be more to life than money. You have to live your life with integrity in all areas. I don’t think you can have integrity at home or at work and then turn around and buy sin stocks.
Besides, surely there are enough socially responsible stocks to choose to invest in. We’re here to make the world a better place not take advantage of people less fortunate than ourselves.