College plan will offer terror-free fund
Missouri’s college-saving plan will soon offer a mutual fund certified to be free of terrorism-connected investments, State Treasurer Sarah Steelman announced today in a Wall Street Journal opinion piece.
The new investment option, available only to investors who use an advisor, is the Roosevelt Anti-Terror Multi-Cap Fund. It invests in domestic stocks, avoiding companies with operations in countries that are identified as sponsors of terrorism. Steelman says Missouri’s College Savings Advisor Plan is also looking at adding an international fund that’s certified as terror-free. The treasurer doesn’t say whether the direct-sold Missouri Saving for Tuition plan — generally a better deal for parents because of its low fees — is going to jump on the anti-terrorism bandwagon.
Her column also details the success of the Missouri Investment Trust — a fund for investing public money — in implementing a terror-free investment policy. She says the Conflict Securities Advisory Group has identified 485 companies, most of them foreign, as having operations in Iran, Sudan, North Korea or Syria, nations which the State Department brands as sponsors of terrorism. And Steelman encourages other investors to avoid those companies, too. She writes:
We are proving that terror-free investing is a matter of choice, and that Wall Street will respond to the demand. What’s more, it can be accomplished with leading investment firms and without sacrificing returns.
The Roosevelt Fund, though, is hardly a “leading investment firm.” According to Morningstar, it is less than 5 years old and has assets of just $14 million. And syndicated columnist Chuck Jaffe raises the question of whether its anti-terror label is a moral choice or a marketing gimmick. Jaffe gives the fund a “Lump of Coal award” for the year’s “tackiest marketing tactic.” Commenting on the fund’s recent name change, he writes:
Playing on fear — and implying that other funds might be “pro” terror — is small-minded; in this case, it turned an issue that was shaping up to be a solid fund into a gimmick.
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David Nicklaus has covered St. Louis business for more than 25 years. His column appears three days a week on the Post-Dispatch business page. 
I wonder how many of the people who would like to apply financial constraints to countries like Iran do so by conserving the oil-based products (especially, gasoline) that supports their economies.
Rather than “feeling good” about the dubious proposition that by avoiding investments in certain companies people are punishing terrorist countries, investors should be concerned about the impact that a future terrorist attack, possibly worse than 9/11, might have on their assets. I think that virtually all stocks could crash. I think that the best investment would be U.S. Treasury securities (and perhaps a stockpile of canned food). I’m not predicting a disaster anytime soon, but given enough time, such things happen. And they are more likely when people in the U.S. casually assume that religious piety or free markets or whatever make the U.S. immune from them.