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CNN Money: You May Own Gun Stocks and Not Know It

CNN Money: You May Own Gun Stocks and Not Know It

By    |   Tuesday, 08 December 2015 05:20 AM

Despite your personal opinion on guns, firearm ownership and what should be done about public mass shootings, you may unwittingly have your money tied up in gun stocks.

“The tragic events in San Bernardino are unlikely to cause any significant change in how Wall Street feels about the firearms industry,” writes CNN Money’s Paul R. La Monica.

“Gun stocks are doing extremely well this year, and well-known funds are benefiting. That means, like it or not, you may even own a small stake in a gun stock through your 401(k) or other retirement account,” he wrote.

According to data from FactSet Research, Vanguard, Fidelity and BlackRock, which each have hundreds of mutual funds, are the top three shareholders of Smith & Wesson (SWHC) — the company that made two of the guns used in the San Bernardino shootings, CNN Money reported.

These three fund giants are also among the five largest owners of ammunition companies Vista Outdoor (VSTO) and Orbital ATK (OA).

BlackRock and Vanguard are the second and third largest investors in Sturm Ruger (RGR).

The stocks are held in a variety of funds, CNN Money reported:

Fidelity owns Smith & Wesson in the Fidelity Advisor Small Cap Fund and Fidelity Low Priced Stock Fund.

Vanguard owns both Smith & Wesson and Sturm Ruger in the Vanguard Small Cap Growth Index Fund.

BlackRock holds both gun companies in the BlackRock Master Small Cap Index fund.

Some of the funds are “passive,” meaning they mirror market indexes, which means managers aren't really picking the stocks.

For example, both Smith & Wesson and Sturm Ruger are in the Russell 2000 index, a popular one for small company stocks.

Meanwhile, “institutional investors – pension funds and some college endowments – have already begun to act,” The Guardian reported.

“City pension funds in Philadelphia and Chicago adopted resolutions vowing to sell off their firearms investments altogether or to do so if the latter didn’t publicly accept stringent new rules and regulations," the report said.

"The trustees of one of the largest pension funds in the nation, the California State Teachers Retirement System (aka Calstrs), voted unanimously to forge ahead with divestment in the wake of the Sandy Hook elementary school murders, in which 20 children and six adults died at the hands of a gunman,” The Guardian reported.

“Rhode Island’s former treasurer and its new governor, Gina Raimondo, oversaw the decision to sell off the state pension fund’s $20 million stake in a firearms distributor,” The Guardian reported.

Meanwhile, New York City Mayor Bill de Blasio urged the city's pension funds to divest their holdings in stocks of gun makers after the San Bernardino massacre, Reuters reported.
 
"I call on all government pension funds in New York City and across the country to divest immediately from funds that include assault weapon manufacturers," de Blasio said in a statement.

De Blasio also appealed to private investors to dump gun stocks and funds that invest in them.

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Despite your personal opinion on guns, firearm ownership and what should be done about public mass shootings, you may unwittingly have your money tied up in gun stocks.
gun, stocks, shares, retirement
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2015-20-08
Tuesday, 08 December 2015 05:20 AM
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