Ethical trading?

[sam76]

As I was watched last nights events unfold in London, I thought to myself "man, people must be making a fortune off the FTSE tonight"

Then it hit me - how do people deal with/justify these opportunities?

I understand that you must trade dispassionately, but I'm just curious, how do people feel about making money off misery?

 

[sam76]

That sounds a bit harsh.

I'm sure you all know what I mean....

eg: I hold MTN (primarily uranium) and I sleep easy at night...

Does anyone hold MST?

Metalstorm (MST) have designed a gun capable of firing a million rounds a minute!

This technology is being developed to clear areas of landmines etc... (good thing), But a million rounds a minute gun would be handy in times of war, too!

 

[krisbarry]

It doesn't bother me at all, most jobs/companies profit from other peoples misfortunes.

I work in a public hospital and the more people that get sick or injured, the more work I recieve and hence the more money I make.

Think of all those professions and the people that work in them that profit by un-ethical people, or accidents or misfortunes

Lawyers
Judges
Police Officers
Doctors
Nurses
Crash Repair Companies - cars
etc, etc, etc

And if you think your immune to this you are wrong....

Most people that work and recieve superannuation will be unaware that some of their money is being filtered into companies such as Telstra. Telstra owns the phone lines, computer systems and services needed for business to set up sex lines and hence profit from the sex industries. So in effect you are supporting the sex industry and allowing it to thrive in an indirect way.

 

[ob1kenobi]

It doesn't bother me at all, most jobs/companies profit from other peoples misfortunes.

I work in a public hospital and the more people that get sick or injured, the more work I recieve and hence the more money I make.

Think of all those professions and the people that work in them that profit by un-ethical people, or accidents or misfortunes

Lawyers
Judges
Police Officers
Doctors
Nurses
Crash Repair Companies - cars
etc, etc, etc

And if you think your immune to this you are wrong....

Most people that work and recieve superannuation will be unaware that some of their money is being filtered into companies such as Telstra. Telstra owns the phone lines, computer systems and services needed for business to set up sex lines and hence profit from the sex industries. So in effect you are supporting the sex industry and allowing it to thrive in an indirect way.

Your point is taken. However, if I knew that my money was going to be used to opress others directly then I would have concerns. "Bad things happen when good people say or do nothing."

 

[Smurf1976]

I unintentionally made money from the London incident. I already had an order placed to short the Australian market index via CFD's if it fell and, sure enough, it fell alright. I didn't have a clue that anything had happened until I looked at my account and wondered why the market had plunged.

I think that everyone has different moral standards. I didn't intend to profit from a terrorist attack, I was just applying my new (still somewhat experimental) system with no idea as to the what and why. Was a very small position anyway...

My views?

Military - I have had more than enough of this "war" nonesense as a cover for bear markets, resource depletion etc. I invest accordingly.

Uranium - I accept the reality of nuclear energy. On the positive side, low greenhouse gas emissions and it has done more to prevent war than practically anything else. Beats sending money to the Middle East but it's far from an ideal industry. I have invested in uranium stocks in the past.

Sex industry - No real problem with it where the workers are there voluntarily. When they are forced then that is another matter. Can't see a problem with passive services on the phone, pretty pictures in magazines etc. As for the workers themselves, the most financially successful and one of the most most intelligent people that I know has a background (5 years full time) in this line of work so don't judge a book by its cover. (In case you were wondering, I met her at a public meeting on an engineering / environmental topic ).

Tobacco - The latest regulation is that cigarette branding such as "extra mild", "ultra mild" etc. has to go. Likewise no more referring to the strength of cigarettes using numbers. I do not smoke but time to get real I think. It's a legal product and consumers do have a right to know what they are buying. Apparently now the manufacturers are going to use terms like "original", "gold", "purple" etc which seems like a sure fire guarantee of confusion. Everyone knows that smoking is dangerous and makes their choices accordingly. I don't hold any relevant stocks but they're not specifically excluded from my portfolio.

Pulp mills - We already have several in Australia and they don't cause major problems so I just don't buy the horror scenarios from those who live near the GNS poposal and are worried about their real estate values. I always prefer to check the facts and ignore the vested interests on either side. I don't hold any forestry stocks though but that is purely a financial decision.

Banks - I object to the lending practices of the major banks which aim to maximise the debt of ordinary people. I do not hold bank stocks simply because I don't want to be involved when the inevitable defaults occur on all those 100% mortgages to borrowers with no deposit, no track record and, in some cases, no proof of income. My decision not to hold is ultimately a purely financial one though.

No doubt we all have different views so invest as you see fit.

 

[bvbfan]

Your point is taken. However, if I knew that my money was going to be used to opress others directly then I would have concerns. "Bad things happen when good people say or do nothing."

What do you think is happening in Africa?
Most of those countries are mineral rich (especially in gold, silver) but the price is suppressed and the citizens are being opressed through this manipulation.

This debt relief while a good idea in principle will not really help anyone in Africa, it will still find a way to rob them of the money they are entitled too.
They will give with the left while taking with the right!

I hope the Blanchard case against Barrick Gold which is set to go to trial soon shows whats been happening.
The big gold hedgers like Barrick, and ones like Normandy and Sons of Gwalia were trying to suppress the price and were hurting a lot of those countries in Africa that relied on gold sales for revenue.

I did contemplate going long US futures when they were down 150 points but thought better of it and just watched the news.

 

[dj_ajay]

HI Sam76,

Yes I do have MST shares and I dont have a problem at all with it. I think their range of artillery is great and the company is a very good prospect!
Howvere, apart from the recent contract to Dragonfly - the share has been decreasing. I look at it as business as long as they are operating in an ethical manner - I dont see it as an issue.
Every country has an army and every country need ammunition, guns, etc.

Cheers

 

[Hanrahan]

I understand the question but I'm not sure why it is asked.

Think of this dilemma from the other side. If someone is conventionally invested in a market with a diversified portfolio including ins companies and feels a genuine concern about his investments due to a terrorist attack, he has the right and OBLIGATION (to his family) to limit his losses by selling early. Who does he sell to? If possible (bolder) buyers are discouraged from buying for fear of being stigmatised then the market will fall off the cliff.

Ergo, buyers are helping stabilise the market and keep it orderly. I see nothing wrong with that.

 

[sam76]

I am in no means passing judgement. (That's why I included MTN)

I'm trying to promote a discourse on the subject...

I think that stock investment, like many other things in life, has passed previously ethical and moral boundries.

Terrorism, natural disaters etc... has made us more and more immune to human tragedy.

I'ts just an interesting topic on human nature....

 

[Hanrahan]

I'm trying to promote a discourse on the subject...

Not sure about the "discourse" but I did reply to the effect that markets are neither moral nor immoral, just amoral.

 

[sam76]

Fortunes made on bombing
By Louise Armitstead and Richard Fletcher
July 11, 2005

THOUSANDS of investors joined sharp institutions in making millions of pounds from the short-lived collapse in share prices that followed the terrorist strikes in London last week.

It was the busiest day of trading for over two years. The London Stock Exchange said 4.75 billion shares were traded on Thursday compared with the recent daily average of about 3.1 billion.
BP and Vodafone were among Britain's largest companies that took advantage of the volatile markets to improve their balance sheets.


Financial spread-betting firm City Index said more than 8000 retail investors had dived into the market on Thursday, correctly backing their hunch that share prices would quickly bounce back.

Advertisement:
Some will find profiteering from horror distasteful. But many in the City applauded the resilience of capitalism.

The opportunity was created by automatic trading systems, used by institutional investors, that began dumping stock when shares fell sharply as news of the blasts spread through the City. At one point the UK benchmark stock index, the FTSE 100, had lost 100 points in two minutes and at its lowest was showing a 4 per cent fall.

"Despite the awful news, there were a considerable amount of people trading and making a lot of money," said City Index chief executive Clive Cooke. "We were deluged with buyers, it was absolute mayhem. In this electronic age, instead of being shell-shocked, investors got straight on to their PCs and took the opportunity to make money."

"We haven't had such a busy day since March 2003, just before the Iraq war," said Ian Jenkins, head of spreadbetting at Cantor Fitzgerald.

The trading firm also reported unusually heavy volumes on its fixed-income floor on Thursday morning as many institutional investors fled from equities to lower-risk assets.

Private investors were buying financial instruments that allowed them to take a leverage position either in the index itself or in leading shares. Investors had been sitting on their hands, concerned the stock market was too high with the FTSE 100 rising to about 5200 on Wednesday.

BP and Vodafone, two of Britain's largest companies, took advantage of the sudden slump in the value of their shares. BP bought in 7.4 million shares, some for as little as 601 1/2 pence. This was close to the intra-day low that its shares hit as the market plummeted around 10.30 on Thursday morning.

On the day of the bombs, BP bought about twice as many of its own shares as its average daily purchase over the past four weeks.


Vodafone also took advantage of the weakness in its share price, spending pound stg. 74 million ($173 million) to buy in 55 million shares at prices around 135p. Only the previous day, it had bought in millions of shares at prices close to 139p.

The Sunday Times

 

[Kipp]

Does anyone out there invest in Ethical Superannuation? For what is a supposedly growth industry- I have found very few super funds who specialise in it.

The AFR had an article recently exposing a few supposed 'ethical' funds whose portfolio was imperceptively different from the standard fund. (Containing BHP, Rio etc).

The only fund that keeps coming up in my research is Australian Ethical Investments. Whose portfolio spead covers some great companies (renewable energy etc) but their fees are pretty extortionate for their returns ~2%p.a. + they charge a 4% contribution fee (on every contribution made)- which doesn't strike me as altogether ethical! Though I think it would be difficult for an ethical fund to match the returns of All Ords (or at best break even) I would feel better if my super was invested in cleaner companies.

So if you have any recommendations I'd like to hear them.
Thanks

 

[Sean K]

Does anyone out there invest in Ethical Superannuation? For what is a supposedly growth industry- I have found very few super funds who specialise in it.

The AFR had an article recently exposing a few supposed 'ethical' funds whose portfolio was imperceptively different from the standard fund. (Containing BHP, Rio etc).

The only fund that keeps coming up in my research is Australian Ethical Investments. Whose portfolio spead covers some great companies (renewable energy etc) but their fees are pretty extortionate for their returns ~2%p.a. + they charge a 4% contribution fee (on every contribution made)- which doesn't strike me as altogether ethical! Though I think it would be difficult for an ethical fund to match the returns of All Ords (or at best break even) I would feel better if my super was invested in cleaner companies.

So if you have any recommendations I'd like to hear them.
Thanks

Give up Kipp. Consume, consume, consume! The planet is going to be hit by an asteroid soon, and we are heading for the sun anyway. Make hay while the sun shines!! he he.