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Investing in the Adult Industry: Loads of money to be made, but who will invest?

Friday, November 16, 2007

Investing in the Adult Industry: Loads of money to be made, but who will invest?

Former hedge fund specialist Francis Koenig in 2005 founded the first institutional investment company to focus specifically on sex industry related investments. Koenig has gone from Wall Street to Los Angeles and believes there are fortunes to be made by matching adult entertainment companies with investors.

This is not the first time an ethically sensitive investment situation has been highlighted in the stock market; there are companies that focus strictly on gambling / casino investments, war / weapons investments, etc. These industries are all very profitable and even from a first glance you can tell the adult industry will be no different.

We have all heard of the brands: Playboy, Hustler, Vivid, etc. Most can even put a face to the names: Hugh Hefner, Larry Flint, etc.

But did you know:

25% of all internet searches involve the adult services industry!

So what is wrong with all these investments?

This is really a question about ethics and how far down the rabbit hole you want to go. If you motivation is strictly to profit in the stock market then all these ethically sensitive investments can produce healthy returns. Sometimes the more outrage something produces the better. More outrage means the topic will remain a media hot button issue and will remain within the headlines and types of companies love the attention; ‘there is no publicity like free publicity.’

However, if you hold yourself to a higher moral standard you may want to rethink some of these investments. If you decide that you do not want to be a part of such investments you need to be more active than the average investor. This requires investigation because not many investors actually know what they are investing in when they buy a mutual fund or even a stock index.

All mutual funds will have to disclose the investments that they have participated in over a given year to investors; however, they do not need to go any further. The next question is what did these companies that the fund I invested in, invest in? This is where the investigation becomes a bit more difficult, but you can see the cycle will continue…what did these companies that the fund invested in, invest in, and what did those investments invest in….?

So it all comes down to personal preference…making money is one thing we all want, how we make that money is up to the individual.

This article was written as a response after viewing a recent press release on msnbc.

Here is a Google Earth link to some Canadian Companies my Investment Advisor has recommended for me.
Investment Opportunities in Canada

Before making any investment decisions you should always consult with a professional to see whether the investments would be a good match for your risk preferences and overall portfolio.

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