Posted on 03/23/2005 6:53:20 PM PST by SmithL
SEATTLE - A mutual fund company that invests only in businesses it deems socially responsible has dropped Starbucks Corp., citing the coffee giant's launch of a java liqueur with whiskey maker Jim Beam.
Pax World Funds, a Portsmouth, N.H.-based fund family, steers clear of companies involved in defense or weapons, tobacco, liquor or gambling. It sold 375,000 shares of Starbucks worth an estimated $23.4 million, about 1.6 percent of its Pax World Balanced Fund portfolio, the fund said in a statement released Wednesday.
"While we continue to admire and respect many aspects of Starbucks' business and corporate citizenship activities, the company essentially forced our hand in this matter," said Anita Green, Pax World Funds' vice president of social research.
In a written response to the Pax World announcement, Starbucks said it was disappointed but understood Pax World Funds' strict policy on not investing in companies that make money from the manufacture of liquor.
"Starbucks is committed to responsible marketing, and proud of our history of corporate responsibility," the statement said. "Prior to the introduction of this product, Starbucks worked diligently to research and understand its potential impact."
Pax World Funds said it sent Starbucks CEO Orin Smith a letter in mid-February urging the company to end its deal with Jim Beam, which was announced last year.
"We have divested ourselves of these shares reluctantly and only after trying to get the company to reconsider its course of action," Green said. "Investors in Pax World Funds expect us to do what we say we will do about avoiding companies that produce liquor."
Starbucks Coffee Liqueur is sold in restaurants, bars and stores licensed to sell liquor. It is not sold in any of the coffee chain's 9,000 stores.
In the statement it released Wednesday, Starbucks noted it is sponsoring a national program aimed at educating parents and children about the dangers of underage drinking.
Message left with Jim Beam Brands Co. and the Distilled Spirits Council of the United States were not immediately returned Wednesday.
Shares of Starbucks fell 22 cents, or 0.4 percent, Wednesday, to close at $51.44 on the Nasdaq Stock Market.
Founded in 1971, the Pax World Funds family includes holdings in companies that sell goods and services which fund managers feel improve the quality of health care, technology, housing, food, education, pollution control, utilities and leisure activities.
The funds family, including Pax World Balance Fund, the Pax World Growth Fund and Pax World High Yield Fund, has about $1.6 billion in assets under management.
That has got to be the STUPIDEST investment strategy ever known in the history of mankind. Everyone of the "investors" (and I use the term loosely) in that fund needs to be sent a copy of Atlas Shrugged, The Wealth of Nations, and Basic Economics by Thomas Sowell.
Sometimes I really think I went to sleep one night and magically woke up in Bizarro World... honestly.
What a bunch of PC weenies! LOL.
Alcohol certainly improves the quality of my leisure activities. What's Pax World Funds' problem?!
You have expressed your opinion, which is your right to do. Are any of you directly effected by this move? Do you have any oney invested in Pax? If not, you don't have a dog in the fight, so run on home now.
Wow. Touchy, are we?
Count me as someone who agrees with their decision. God bless them for standing up for what is right. PC my butt.
Thanks for the tip!!
No. I can't say that I was affected.
Lighten up, Francis.
2. I don't have to run home, I'm already there.
3. I do own Starbucks stock, as well as shares of other mutual funds who invest in Starbucks... so as a matter of fact, I did loose money (on paper) today based on this IDIOTIC investment strategy. In the long run, my investments will be fine, but I reserve the right to call the idiots who run PAX, well, IDIOTS.
4. We are here on FR for the express purpose of discussing issues such as this. Geesh...
OK, how about both... they really could use all the help they can get... lol.
FMCDH(BITS).
the FM is just reflecting what his clients want to invest in... that was the whole point of starting the PAX fund in the first place... to get the best return they can on stocks that FIT their faith/lifestyle not just stocks with the best ROE
There are a great many thing in this world that I find amusing, most of which I would never consider putting my own money into. That includes not only most of Starbuck's corporate appeasement of the looney left, but also the entire concept of the Pax fund. If you don't like my unfunded involvement in this silliness, you may either ignore me, or run home yourself. That's the glory of free expression.
:-)
hahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahah..........!
I bet these pansies ride those nancyboy lay-down bicycles, too.
I don't have a problem with that...Just call me when you buy your next bottle...
Just damn.
If you want on the list, FReepmail me. This IS a high-volume PING list...
Well, they haven't made any money over the last five years, but they feel great about themselves...
Pax World has the right to invest however it makes them happy. Since liquor violates their policy, then good for them for sticking by it.
Me, I'm more of a Vice Fund kind of guy..
You can shove it you no where. Why are you trying to silence discusion on FR? It smells to me like you are the type that would be dumb enough to invest in this kind fund, and you don't like anyone bad-mouthing it.
Do you know what the return on an investment with these folks is? I have no idea - just curious if it is a successful strategy.
Especially when you have a shot with your java. LOL
Oh dear mommie, he said something nasty to me.
Yes, I understand that... however very notion of investing based on "faith" and "lifestyle" is exactly what's wrong with the concept of PAX.
Maximizing ROE is not always the best objective for an individual, especially if you are trying to lower risk. Someone close to retirement would fit this category. But investment strategies that have NOTHING to do with potential corportate performance is nutty. This seems so obvious to me... I have a hard time articulating how odd the notion of PAX seems to me.
Maybe some people HERE need a copy of Atlas Shrugged. lol.
Nov 22-23, 1963.
PAX runs four funds.
1. PAX WORLD BALANCED FUND. The five year return is APPROXIMETLY -9.1%
2. PAX WORLD GROWTH FUND. The five year return is APPROXIMATELY -23.3%
The other two are bond funds, one with a reasonable yield, 6.6%... the other I can't find data on (it's very new).
In summary, as pure investments, if your goal was to actually INCREASE your net worth, THEY SUCK. If your goal is to loose money and feel better that you aren't supporting "immoral" corporations, well then, they are GREAT!
i can quote you Atlas chapter and verse... and i never said that i agree with their strategy... but people are still free to pool their money where their conscience bothers them the least... they can make a profit and still sleep at night so to speak, and there's nothing wrong with that... so long's the FM is honest and makes them the rate of return they expect... then he's fulfilled his fiduciary responsibilities
woooo... just saw your numbers. like posted above... at least they feel real good about themselves while going broke!!! 8^)
I've had the liqueur, it's wonderful
I don't think we disagree on the issue of the fund manager and whatnot. I never tried to claim that people don't have a right to invest according to any strategy they choose... if they want to follow the PAX idea, fine by me. If one can sleep well at night knowing his investment lost 23% since 2000... well, what can I say? lol.
BTW, just an interesting sidenote. I had to go to my fund research resources to find the rate of return for those funds. I tried to find them on the PAX website but THEY DON'T LIST HISTORICAL RATES OF RETURN. They do have a list of share prices going back only about two years, but that's NOT standard reporting, as it does not take into account fees and yields (if any). I can't imagine EVER investing in a fund whos own website doesn't even bother with industry standard historical data. It's very amateurish.
Coffee is just as addictive as tobacco and liquor, and playing the stock market is really no different than gambling. But I'm sure they feel self-righteous and all that.
I predict a skyrocketing rate of return now that they've dumped Starbucks. sheesh!
Oddly, I now have a reason to go to Starbucks ...
yeah, ya get what ya pay for sometimes... A is A
Yeah, now that PAX dropped that deadweight from the portfolio, they're sure to improve on the -23% 5 year average. The five year increase in value of Starbucks stock is ONLY 257%. Imagine how much money the fund can loose in a socially responsible manner now that they don't have Starbucks to earn money for them!!!
I wonder if I can short PAX?
Pax isn't the only fund of that nature. There's always Domini.
There are a lot of Foundations, Hospitals, Endowments and Church pension funds that have restrictions about how their money is invested. Some of those restrictions aren't far off from Pax's.
Yikes - thanks for the financial advice!
vice Fund:
...
2.8% - Constellation Brands
2.6% - Armor Holdings
2.6% - Harrah's
...
ARMOR? SPAM?
But if a company comes along that is involved in "medicinal" marijuana, they'll plow everything they got into it.
Why are you railing at an investment company choosing its stocks however it jolly well pleases?
How many people have been kneecapped by E. F. Hutton?
I was referring to legalized gambling. No one at PAX is going to do any kneecapping. After all, they are the ANTI-GUN socially responsible investment choice! It's all a matter of how one likes to take their sin. I'll take mine with a little Starbucks coffee liquor on top.
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