Extra, Extra

SallyB2
By SallyB2 Last edited 100 months ago
Extra, Extra

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  • A couple have been murdered in Croydon: their son has been arrested.
  • Boris. East Enders. Tonight.
  • God has intervened in the threat to the Gaumont in Kilburn.
  • The Devil's work, on the other hand, can be seen in Croydon, where the council has 'fessed to investing in British American Tobacco.
  • Islington's blooming.
  • Cab manufacturer Manganese is pondering job cuts.
  • The RAC has belatedly come out in support of the bendy bus.

    Image by KB!!! via the Londonist pool.

    Last Updated 01 October 2009

    Tom Williams

    On that Croydon story, it's worth mentioning that most large pension schemes, public and private (as well as anyone investing in a stock market index tracking fund) will have an investment in British American Tobacco, if only because it is a constituent (c2.5%) of the FTSE100.

    In fact, if you strip out all the tobacco, alcohol, mining, oil & gas and arms companies from the index of 100 leading British shares, you lose about a quarter of the index (in market capitalisation terms).

    I'm not condoning Croydon's decision to move from an ethical investment strategy to a more conventional one for their pension scheme, however, it seems rather harsh to single them out for special criticism.

    It's also worth noting that tobacco stocks are traditionally viewed as defensive holdings. This is thanks to the secure income streams generated from their addictive products. Therefore, assuming you have no ethical views on such things, tobacco makes a good investment in a recession.