I see what you're saying: "socially responsible", with further explanation, just means "little gold stars to me for being righteous."

I am simply logically addressing the concept of socially responsible. Not giving investing advice

People could be self-righteous about it, but if the fund's goals happen to align with the investor's, I see nothing more self-righteous about it than any variety of mutual fund.

" Recently, bar drinking is way down among young people due to DUI crackdowns."
I also wonder if things like Google Hangouts and other computer communication make kids slightly more inclined to drink "alone".

I was in Domini in the late 90s. It was very highly correlated to S&P. It seemed like it invested in S&P minus a few industries. Maybe it also voted its proxies in a way managers considered socially responsible.

One of the problems with public equity, IMHO, is ownership is separated by many layers of abstraction from the management. Socially responsible investing supposedly tries to undo this by making the fund managers consider the retail investors' values, but the rub is those values will very from investor to investor.

DavidMcNab suggests some values I agree with. One socially conscious fund I looked at years ago avoided gambling alcohol, and guns, which I personally do not oppose. They may not care about fossil fuels and large-scale armaments, which I do oppose. It's best if your portfolio is large enough you can tailor it yourself.

That was my observation too, Lucky. I wondered if I had missed something. I saw no evidence that PC investing has beaten S&P; I saw no evidence of anything, actually.

One of Matt Ridley's articles was on this recently (here, let me include the link: http://rationaloptimist.com/blog/fossil-...). In this article he points out that apparently the Church of England made a big splash about selling a small number of shares in coal...and got some good publicity but did not really hurt its investment portfolio.

Huh, what a game.

Jan

Interesting - the actual website for the
fund that invests in this index shows that
"Socially responsible" investing does just the opposite of the article headline -
it ALWAYS underperforms the S&P 500 -

https://www.domini.com/domini-funds/fund...

time to hunt for another index/label/statistic with the results you want - to fit a preconceived headline.

There are thousands of mutual funds. By random chance there will always be a few that can make this claim. 5 or 10 years from now it will be a different few. Just as in other forms of gambling, the dice have no memory.

If I can look past the jargon and the misinterpretation and misapplication to the core concept here, from one perspective, this is already a factor in my investment decisions (btw, I invest time, energy, attention and relationship, as well as money).

I invest in that opportunity, among those available to me, that generates the greatest total value per quantity of resources invested - total value meaning the product of the number of things I value times the degree to which they are created, furthered and enhanced.

In the finance arena, more simply stated in the framework of this article, given multiple investment options with the same monetary return, I will select those that have the geatest positive impact on and alignment with other values of mine. I might even take a little financial hit to select one that creates a really big return in some of my non-monetary values.

Food for thought....

If this is true...why even do an article about it, unless you're trying to drive "your" point home.

It sounds more like someone trying to convince themselves (and all their Liberal counterparts) that it's the truth.

Hang on, folks, what are you talking about? What's the problem here?
I just LOVE "socially responsible" investing.
Galt-style 'socially responsible', that is ;)

The Gulch needs its own form of "Socially responsible" investing - a fund investing in companies who:

1. Abstain from lobbying Congress for favours and concessions, rather, adapting to tough market conditions through their own inventiveness
2. Do not take advantage of any funds sourced at the point of a gun, eg government development grants
3. Abstain from any 'equal opportunity' policies, instead, recruiting, retaining and promoting staff purely on merit
4. Avoid, wherever possible, sourcing their inputs from looters
5. Avoid, wherever possible, selling their outputs to looters
6. Have internal policies rewarding greed, initiative, creativity
7. (difficult, so not immediately mandatory) require all employees, management and board members to swear The Oath upon their induction.

Anyone got a few spare mil to start up such a fund and toss it up on the NASDAQ? I got dollars looking for a nice home to snuggle in to :D

I'm familiar with the author. She missed the mark on this one, but she's usually entertaining. I'm not allowed to talk about securities on the internet so that's all I'll say...

Happy Friday

No problem with people voluntarily investing with those parameters...

I could understand "morally responsible" investing,
for instance, in the case of refusing to finance
totalitarian states. But I don't agree with going a-
long with all those environmentalist fads.

It's good that I didn't read it with my morning coffee -- I would have spewed. What is really skewed is that such an article gets published at all. It seems that some evidence of decline happens not every day any more, but every hour.

The comments from some of the loons following the article are scarier.

I suppose "socially responsible investing" could also be called "PC investing."
That would also be something someone like a Clinton or a Gore would get a "more than equal elite better hypocrisy pass" for totally ignoring.
"Do what we say not as we do."

This may have been written to sway people who would flock to the word "socially responsible" (which Khalling took to task beautifully).

In defense of the concept, I avoid investments, even if they look promising, in things I don't believe are right. Why? Because, objectively, I don't want to see them succeed.

The article presents an interesting dataset. Some examples correlate, but there is no evidence of consequence. Tobacco use has been on the down turn for 30 years, partially due to taxes, partially due to public opinion, definitely due to a massive Government campaign against it. This campaign is an interesting example (may need a post - I dislike, any such intrusion, but have certainly benefited from it as a non-smoker).
Alcohol, is clearly another issue. Recently, bar drinking is way down among young people due to DUI crackdowns. Hard liquor consumption is also on a global down swing, with a few local exclusions, such as in Asia. traditional brewing is down too. Budwieser is doing less well since the Inbev acquisition. Miller, Coors, etc. However, microbrewing's rise is meteoric! I view this as simply people actually trying things, instead of drinking like lemmings. Wine consumption in the US has been on the rise for 20 years as well. Clearly the right investment here can pay off, and I do not find it socially irresponsible. How many people get blasted on microbrews and drive drunk?

Clearly there are examples where this fails, fiscally and "social irresponsibility"...what ever that is.

Love they way you put this K, just love it!

Stuff like this makes me really like investing in real estate. Getting checks every month from renters is pretty nice.

I did not see the results of studies, or mention of the studies, that came to that conclusion.
There was mention of stock A being better than stock B explained by the usual investment criteria.
A claim that choosing investments on non-financial grounds will produce a better financial result than choosing on financial grounds requires, well, very strong evidence.
Some years ago when this fad was taking off, I asked my broker if there was non-ethical (socially irresponsible) fund that I could invest in, not entirely as a joke.

Got it- the data must have been homogenized!

"Socially responsible" is one of those amorphous meaningless concepts which really are intended as a special badge of authority. I 'm responsible for telling you what you are doing wrong and should stop for maybe the children but mostly me because I don 't like it. Kinda makes me want to go responsibly invest in more firearm company stock. Like Franklin Industries, the ficticious firearm manfacturer at the heart of Trails of Injustice. :)