Question

In: Finance

If you ethically invested, what types of issues would you take into consideration? Do you think...

If you ethically invested, what types of issues would you take into consideration? Do you think the returns on ethical investments are always lower than non-ethical investments? In what ways could ethical investments outperform non-ethnical investments?

Solutions

Expert Solution

Ethical investing is the method of selecting stocks based on moral principle.if I would have been ethically invested , factors I would have taken for consideration are as follows-

1. Avoid investments from sin stocks

2. Avoid investment into companies with stigmatised activities like gambling,firearms

3.avoid investment in companies whose management has been in any kind of immoral activities.

4.Avoid investment in companies who did not participate in social awareness programs and does not contribute to social funds

yes I think that return on ethical investments are always lower than return on normal investments because normal investments are based upon performance while ethical investments are based on emotions .

Ethical investment can only outperform normal investment by investing two companies which are high growth, less leveraged , profit-making, good corporate governance, less litigations.


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