Andersen Effect

Finance allah shmoop what is an ethical fund an ethical

fund the political weapon of unsophisticated finance people throwing straw

at brick houses everywhere Well unethical fund is one that

has no ah sin or no investments in what they

perceive as bad things like you know porn google images

and snapchat facebook tobacco philip morris altria arguably the best

investments over the last century Guns and boeing rockwell bomb

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

oil chevron shell bp hollywood it is neat bike on

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

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

people converse Teo then deliver all of the above way

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

quote ethical funds unquote healthy ethics are in the eyes

of the beholder Go to a church service in the

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

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

portfolio then what A bunch of hippies in marin county

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

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

fund which named itself to be and ethical fund Who

determines what investors would feel good about investing in and

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

start a fund investing on lian companies who are funny

like intentionally funny not like you know g and those

guys Well the problem is that for better or worse

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

list of buyable stocks in and ethical fund are often

actually really good Businesses like oil and gas for example

has been a stalwart for a century in the u

s so has tobacco And oh by the way most

technology companies early histories were driven by profits in and

around porn So there is in essence a price that

investors historically seemed to be paying for the privilege of

being all judgy about what ethics are meaning that results

in ethical funds tend to lag their competitors by a

few percent each year and over a couple of decades

While that means that ethical funds end up being worth

a lot less than unfiltered funds their funds who just

are out there trying to make money for shareholders and

then the big question gets asked from the ethically rich

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

best ethics just revolve around legally producing the best financial

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