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An SRI beast

Always a watcher of the latest trends, this Dark Beast is now considering establishing the Bête Noire SRI Fund, to fill a unique market niche.
Being a heavy smoker, excluding tobacco companies doesn’t seem that attractive to this Beast. In fact smokers save money for the health service by shortening their lives, and they pay more in taxes than they cost, so tobacco firms perform a public service and should be heavily weighted.
Alcohol firms similarly help society. After all, Jesus Himself turned water to wine. And we all enjoy a flutter, so gaming firms are in too.
Shell should be out of course. It has shown extreme cowardice in the face of greenmail; clearly the best place to dispose of Brent-Spar was the deep blue sea. Esso, on the other hand, has shown courage in the face of similar threats so it should be in.
Any firm helping countries to defend their freedom, by selling them arms, should of course be over-weighted, as long as they don’t sell to Zimbabwe. Indeed any trade with that racist tyranny, or communist Cuba and China, should be discouraged.
There are firms which insist on paying wages in the third world far above prevailing levels, thus reducing the number of people they can afford to employ. Worse are firms which avoid poor countries altogether. The proposed fund will favour those companies which maximise the number they can help, by paying only slightly more than local salaries. Firms should of course also follow local standards on appropriate ages for the young to start work.
Language is a good objective guide for investment choice. Take ‘sustainable development’ for example; if it means what it says it is a bad thing – resources should be used rather than ignored even if they will run out – and if it doesn’t refer to that it is meaningless. Clearly any firm which uses words like ‘sustainable’ in its reports is guilty of sloppy thinking, which can not be good for long term profits.
A key argument by many SRI funds is that they look for firms with policies which will avoid environmental and political costs, or simple embarrassment, from their policies. In other words a slave trader who won’t be caught is OK, but a firm that ignores scientific research to follow the latest environmentalist whim is not. In contrast, the Beast’s SRI Fund will always avoid bad things, even at the cost of lower returns, and will stick to good research, whatever the current fashion.
Some will call the new fund “the Beastly Fund”, but why should this dark monster’s political preferences be any worse than theirs?

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    Asset class: Fixed Income, Emerging Market Debt Hard Currency (Active).
    Asset region: Emerging Markets.
    Size: CHF 300-400m.
    Closing date: 2019-07-30.

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    Asset class: Fixed Income, Emerging Market Debt Hard Currency (Passive or Passive Enhanced).
    Asset region: Emerging Markets.
    Size: CHF 300-700m.
    Closing date: 2019-07-30.

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    Asset class: Fixed Income, Emerging Market Debt Local Currency (Active).
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    Closing date: 2019-07-31.

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    Asset class: Fixed Income, Emerging Market Debt Local Currency (Passive or Passive Enhanced).
    Asset region: Emerging Markets.
    Size: CHF 250-350m.
    Closing date: 2019-07-31.

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    Size: EUR 50 - 100 million.
    Closing date: 2019-07-22.

  • QN-2556

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    Asset region: Global.
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