May, 2010

May 10

Why the euro will continue heading south

Investing in vice

Late one night, over a cigar and a 1958 Armagnac in the craftily hidden Garden Bar of the Lanesborough Hotel, I was told of a great investment opportunity. The Vice Fund, a mutual fund that had outperformed its benchmarks by “an order of magnitude.”

As a rule, investment tips exchanged in bars where billionaires lurk darkly should be ignored. But the appeal of a fund that invests in industries that are automatically excluded from corporate responsibility indices, ones that appeal to self-destruction and the destruction of others (smoking and arms manufacturers), as well as addiction (gaming and alcohol), tickled my fancy. Philip Morris is its biggest holding, along with Lockheed Martin and Carlsberg, among others.