Goodreturns: In this month’s commentary, Pathfinder looks at real world implications of responsible investment (RI). Are RI returns better, worse or no different than market returns? What investment options are available within NZ and from offshore?
Can investing in “bad stuff” pay off? The short answer is “yes, sometimes.” Sectors avoided by many ethical investors can have periods of strong returns. Tobacco is the most widely discussed sector – it has been bad for your health as a consumer but great as an investment. Despite tobacco consumption shrinking globally and large law suit settlements, tobacco stocks have delivered total returns of 13% annualised since 1997. This is quite remarkable, especially given the overall market has returned 4.5% over the same period. More>