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Finance: What is an Ethical Fund? 22 Views


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Description:

What is an Ethical Fund? An ethical fund is one in which a specified set of ethical principles for company and industry sector investment selection is the first level of criteria for consideration before financial considerations. The ethical principles are subjective and may be religious or activist based. Certain religious ethical funds will not invest in gaming or alcohol industries, for example. Others may assiduously avoid or prefer other industries, such as pharmaceuticals or solar energy.

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00:00

Finance allah shmoop what is an ethical fund an ethical

00:07

fund the political weapon of unsophisticated finance people throwing straw

00:13

at brick houses everywhere Well unethical fund is one that

00:16

has no ah sin or no investments in what they

00:21

perceive as bad things like you know porn google images

00:26

and snapchat facebook tobacco philip morris altria arguably the best

00:32

investments over the last century Guns and boeing rockwell bomb

00:37

gambling a vegas casino caesar's sands yeah that's not really

00:43

oil chevron shell bp hollywood it is neat bike on

00:49

the other and then there's technology which delivers all of

00:52

the above and let's not forget about telecommunications which lets

00:56

people converse Teo then deliver all of the above way

01:00

Going too far here Yeah and that's the problem with

01:03

quote ethical funds unquote healthy ethics are in the eyes

01:07

of the beholder Go to a church service in the

01:10

deep south and it's likely the congregation will give you

01:13

a completely different quote It's ok to invest in unquote

01:18

portfolio then what A bunch of hippies in marin county

01:21

california So who's to say what is ethical and what

01:24

is not Well actually it's the gang marketing the mutual

01:29

fund which named itself to be and ethical fund Who

01:32

determines what investors would feel good about investing in and

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hey that's fine Someday it's him up We want to

01:39

start a fund investing on lian companies who are funny

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like intentionally funny not like you know g and those

01:46

guys Well the problem is that for better or worse

01:49

a large portion of the name's actively omitted from the

01:52

list of buyable stocks in and ethical fund are often

01:56

actually really good Businesses like oil and gas for example

02:00

has been a stalwart for a century in the u

02:02

s so has tobacco And oh by the way most

02:04

technology companies early histories were driven by profits in and

02:09

around porn So there is in essence a price that

02:13

investors historically seemed to be paying for the privilege of

02:16

being all judgy about what ethics are meaning that results

02:21

in ethical funds tend to lag their competitors by a

02:24

few percent each year and over a couple of decades

02:27

While that means that ethical funds end up being worth

02:29

a lot less than unfiltered funds their funds who just

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are out there trying to make money for shareholders and

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then the big question gets asked from the ethically rich

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and financially poor from the poor house i shouldn't The

02:42

best ethics just revolve around legally producing the best financial

02:47

return for investors Know what a concept investing in order 00:02:52.165 --> [endTime] to make more money Who'd a thought

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