Socially Responsible Investments?

[nnuut]

What's next? And who would make the decisions of just what companies are qualified? The Current Administration.:cool:

Bill Would Create ‘Socially Responsible’ TSP Fund

by Ian Smith (http://www.fedsmith.com/author/ian-smith/) | November 25, 2013

Congressman Jim Langevin (D-RI) and Senator Sheldon Whitehouse (D-RI) have introduced legislation that would allow federal employees to make socially responsible investments (SRI) in their retirement plans.

Known as the Federal Employees Responsible Investment Act (https://www.govtrack.us/congress/bills/113/hr3563), the legislation would direct the Federal Retirement Thrift Investment Board to select a “Corporate Responsibility Index” as an option for Thrift Savings Plan (TSP) contributions by federal employees – allowing them to direct their retirement investments toward socially responsible corporations, and away from ones with poor environmental and human rights practices.
Langevin has been a strong advocate for socially responsible investment, championing legislation in the House over the past five sessions of Congress.
Bill Would Create ‘Socially Responsible’ TSP Fund - FedSmith.com (http://www.fedsmith.com/2013/11/25/bill-would-create-socially-responsible-tsp-fund/)

[tsptalk]

I think there are other options that would be a priority over something like this... Like a precious metals fund, REIT's, energy, etc., or how about a bear fund for those bear markets?

[MrBowl]

I agree, Tom. I've been wanting to see a NASDAQ and tech fund for a long time.

I think even more important would be to make transactions instantaneous or at least make the deadline at the market close. And, of course, more friendly IFT rules.

But instead it looks like the TSP folks will be tied up with feel-good rules.

[Sensei]

Obviously, a committee would have to be formed to determine the parameters of this "Corporate Responsibility Index". Several people with 6-figure salaries would sit on this committee, headed by someone with political ambitions. It sounds like this Jim Langevin owes some people favors, and intends to pay them by means of government bloat. Socially responsibility my... (and I consider myself "liberal" compared to most of you folks around here :D)

[James48843]

I would support the idea simply from the standpoint that it becomes another option for people to look at and invest in.

Here are some choices to benchmark against:
http://money.usnews.com/money/personal-finance/mutual-funds/slideshows/8-great-socially-responsible-funds

As you all know, the Congress authorized the Thirft Board several years ago to make alternative investments to the TSP participants through the establishment of a "window", which was supposed to allow someone to invest in more than just the existing funds. However, the Thrift Board as never exercised it's legal authority to expand that "window" into other investments.


Sure, I'd like to see precious metals, a REIT fund, and other vehicles.

But that doesn't mean I would not be grateful for a single additional opportunity in a "socially responsible fund".

Hey- we also need a guns, ammo, beer and Sweaty Betty fund.

Have you heard of the "VICE FUND"? A real sinner's dream come true:



The most interesting fund on the list, however, could be the Vice Fund (VICEX) (http://www.maxfunds.com/funds/data.php?t=1&mfid=107215&symbol=VICEX), whose aim is to attract investors whose moral compasses point squarely toward Las Vegas:

The fund focuses on four sectors: defense/weapons, gambling, tobacco, and booze. As the fund’s website proudly boasts in all caps, no other fund concentrates solely on these four sectors. As fund manager Charles Norton told the Financial Times in 2006, '[N]o matter what is happening in the world economy, people will continue to drink, smoke, gamble and nations will need to defend themselves. As a result, in general these companies tend to be steady performers in good times and bad—they are mostly insulated from economic slowdowns.' In short, the fund has targeted four areas of the economy where it thinks demand is fairly inelastic whether for reasons of addiction or necessity as a hedge against market downturns. It works, too; for 2006 the fund had returns of over 23%."




Why not diversify?

Saints, and sinners.

[Sensei]

I would agree with you, James, except that a "corporate responsibility index" would need to be constantly monitored and evaluated, which means multiple people need to be on staff to develop standards and carry out the evaluation. That would cost money, and we would end up footing the bill. REITs, PMs, bear funds, etc. are self-identifiable. Sweaty Betty funds... well, I'm not sure about that. Sounds intriguing though. ;)

[Cactus]

From what I've seen, there is nothing special about the companies in these funds. They are a lot of the same ones we already have in our indexes. The fund managers just just look for stuff in the by-laws like: striving to reduce toxic emissions by 5% over the next decade and you're in. I can't buy-off on stuff like that. I agree that we are just going to end up paying a bunch of political appointees to coerce corporate America into abiding by the changing winds of the administration in office at the time.

I'll tell you what. I'll compromise. Just give me a 3rd IFT and we'll call it good.

[Frixxxx]

Seems like a true subset of investors that would run to this option. I would like as much diversity in my portfolio, but it comes with a cost. I'm with Cactus on this though. More IFT's means better opportunity to make money. My social conscious dictates that I make money for me to live off the rewards, not someone else.

If someone needs to feel good about their investments, so be it. But if they use the excuse to raise the management fees, then I want my IFT's back.

[nnuut]

It's just the liberal Goody-Goody Fungus trying to infect our retirement fund, don't fall for it.

[RazorCat]

I would support the idea simply from the standpoint that it becomes another option for people to look at and invest in.

Here are some choices to benchmark against:
Parnassus Workplace (PARWX): 8 Great Socially Responsible Funds - US News & World Report (http://money.usnews.com/money/personal-finance/mutual-funds/slideshows/8-great-socially-responsible-funds)

As you all know, the Congress authorized the Thirft Board several years ago to make alternative investments to the TSP participants through the establishment of a "window", which was supposed to allow someone to invest in more than just the existing funds. However, the Thrift Board as never exercised it's legal authority to expand that "window" into other investments.


Sure, I'd like to see precious metals, a REIT fund, and other vehicles.

But that doesn't mean I would not be grateful for a single additional opportunity in a "socially responsible fund".

Hey- we also need a guns, ammo, beer and Sweaty Betty fund.

Have you heard of the "VICE FUND"? A real sinner's dream come true:

Why not diversify?

Saints, and sinners.

I have it on good authority this new fund will be called the "T" fund (Tree Hugger). I'm not comfortable investing in anything that starts with the word "Social". Reminds me to much of "Social-ism, "Social-ist". Socially responsible investments fund? Anybody want to bet the goverment will write it up so they can control and change where the money in that fund is invested. And if I understand it correctly, you don't earn actual interest on your investments in the T fund.
You'll be paid in Carbon Credits.
I do like the idea of a "V" fund (Vice). The only areas of the economy that have shown consistent growth in sales during market highs and market lows is alcohol, tobacco, firearms, and porn. And since the government has adopted the attitude that they know what's best for everyone, they could always designate other items as a vice and charge a "sin" tax for participation. Hunting, fishing, fast food, conservative blogging, the possibilities are endless.

[Frixxxx]

I have it on good authority this new fund will be called the "T" fund (Tree Hugger). I'm not comfortable investing in anything that starts with the word "Social". Reminds me to much of "Social-ism, "Social-ist". Socially responsible investments fund? Anybody want to bet the goverment will write it up so they can control and change where the money in that fund is invested. And if I understand it correctly, you don't earn actual interest on your investments in the T fund.
You'll be paid in Carbon Credits.
I do like the idea of a "V" fund (Vice). The only areas of the economy that have shown consistent growth in sales during market highs and market lows is alcohol, tobacco, firearms, and porn. And since the government has adopted the attitude that they know what's best for everyone, they could always designate other items as a vice and charge a "sin" tax for participation. Hunting, fishing, fast food, conservative blogging, the possibilities are endless.

Please sign up to purchase your government mandated "Soilent Green" stock and free sample. I hear the returns are phenomenal. Endless supply chain of source ingredients. Low overhead, mandatory participation.