Root of all evil: Ethically unsound firms make a lot of money
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Brokerage firm Willis Owen has unveiled plans to
launch a 'vice' fund dedicated to putting money in companies shunned by
ethical investment campaigners.
It will focus in particular on "high dependency" stocks
- shares in firms such as betting shops, and alcohol and tobacco
manufacturers - which hold up well during recessions, and prosper
during boom times.
Willis Owen said backing such companies can yield good
returns for individuals whose consciences are not troubled by their
investment decisions.
"It may not be politically correct, but we all know that
sex, drugs and rock-and-roll sells," said Willis Owen managing director
Richard Craven.
The vice fund, which Willis Owen aims to have up and
running within the next few weeks, is based on a similar venture in the
US which has generated twice the returns of the broad S&P 500 share
index since being launched last year.
Groundbreaker
The fund is also partly inspired by so-called leisure
funds - investment vehicles specialising in casinos, alcohol and
tobacco which were popular in the 1980s before falling out of fashion
amid growing concerns over health and the environment.
It will be the UK's first 'socially irresponsible'
investment fund, the polar opposite of initiatives aimed at promoting
ethical investment such as the much-hyped FTSE4Good share index.
Mr Craven told BBC Radio Five Live that while many
existing funds already include tobacco and alcohol firms in their
investment portfolios, Willis Owen's vice fund will be the first to do
so explicitly.
"What we're trying to do is to cut through the marketing gloss in the retail investment sector," he said.
However, Willis Owen stressed that companies with a
track record of environmental pollution, or which rely on cheap labour,
would remain off limits.
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