Sin industry

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Sin industries are commercial activities which while legal are often considered to be immoral, unethical or harmful. They include industries such as the alcohol, tobacco, weapons, gambling and sex industries. [1] [2] Stocks in such companies are known as sin stocks. [3]

Investing in sin stocks can be viewed as the opposite strategy to investment based on environmental, social, and governance (ESG) principles. There is some evidence that sin stocks may outperform stocks in other types of companies; however, these results have been attributed to statistical biases, rather than any inherent advantage of 'sin'. [4] [5] [6] [7] Seemingly paradoxically, companies in 'sin' sectors may have higher ratings in the social aspects of ESG than other comparable companies. [1]

See also

References

  1. 1 2 Du, Linda Y. L.; Sun, Jianfei (2023-07-01). "Washing away their stigma? The ESG of "Sin" firms". Finance Research Letters. 55: 103938. doi:10.1016/j.frl.2023.103938. ISSN   1544-6123.{{cite journal}}: CS1 maint: article number as page number (link)
  2. ↑ Lohia, Rajani (June 25, 2025). "Top Sin Stocks for Savvy Investors: Profiting From the Unconventional". nasdaq.com. Retrieved 2026-01-14.
  3. ↑ Kenton, Will (April 14, 2022). "Sin Stock: What it is, How it Works, Pros and Cons". Investopedia. Retrieved 2026-01-14.
  4. ↑ Hong, Harrison; Kacperczyk, Marcin (2009-07-01). "The price of sin: The effects of social norms on markets". Journal of Financial Economics. 93 (1): 15–36. doi:10.1016/j.jfineco.2008.09.001. ISSN   0304-405X.
  5. ↑ Marsh, Hannah (16 June 2015). "Does it pay to be bad - why 'investing in sin' pays". London Business School. Retrieved 2026-01-14.
  6. ↑ Marriage, Madison (13 September 2015). "Research shows the wages of sin turn out to be a bit mediocre". Financial Times.
  7. ↑ Adamsson, Hampus; Hoepner, Andreas G. F. (2015). "The 'Price of Sin' Aversion: Ivory Tower Illusion or Real Investable Alpha?". SSRN Electronic Journal. doi:10.2139/ssrn.2659098. ISSN   1556-5068.


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