There's Money in Vice

Jason English

I don't know much about investing, which is why I'll never own an airplane. But I found a mutual fund that intrigues me.

The Vice Fund, managed by 32-year-old Charles Norton, invests solely in companies that satisfy vices. Companies like Heineken, Diageo, Wynn Resorts and Altria (formerly Philip Morris). Besides smoking, drinking and gambling, the Vice Fund also invests in Aerospace & Defense. "Maybe in a perfect world these industries wouldn't need to exist," their website says about Defense contractors. "But until that perfect world does exist, we want to own these stocks."

Since September 2005, the Vice Fund (25.2% return) has outperformed both the S&P 500 (18.8%) and the Calvert Social Index (14.3%), which is Vice's total opposite.

According to the Vice Fund's website, the industries in which it invests are "nearly recession-proof." I suppose this is because during any economic downturn, people like to drink, smoke, gamble and start wars.

[Via Paul B. Brown and The New York Times.]