Are You a Gun Owner & Don't Even Know It?

You could be a shareholder of major gun companies in your 401(k) and IRA, without you knowing it. If this bothers you, then read further.

Some U.S. stock funds own gun companies like American Outdoor Brand Corp (AOBC); Sturm, Ruger & Co (RGR); and Vista Outdoor (VSTO).

Sturm, Ruger & Co. is one of the biggest gun suppliers in the country, producing a wide array of assault rifles, pistols, and revolvers. American Outdoor Brand Corp and Vista Outdoor sell “modern sporting rifles” such as the AR-15 assault rifle.

Gun stock exposures of funds

If you own a total stock market index fund, a U.S. small cap index fund, or the S Fund in your Thrift Savings Plan (for federal employees), chances are you are a shareholder of these gun manufacturers.

For example, the Vanguard Total Stock Market Index owns about 1.3 million shares of American Outdoor Brand Corp; 400,000 shares of Sturm, Ruger & Co, and 1.4 million shares of Vista Outdoor. Here’s a list of other index funds that own shares of these gun manufacturers.

If that bothers you, fear not, because you can create a more socially-responsible investment portfolio in your 401(k), IRA and brokerage accounts.

Gun-free portfolios

You can choose ethical funds that screen out companies engaged in weapons, fossil fuels, gambling, and tobacco.

Other funds go further by seeking companies who are trying to make a positive impact in society. It selects companies that meet specific criteria on environmental, social, and governance factors, like: commitment to higher labor standards; clean supply chain; board and management diversity; and lower carbon emissions.

Is there a financial trade-off for doing socially-responsible investing?

Three years ago, I would have told a client that they might have to delay retirement by a couple of years. But recent studies by Morgan Stanley, Deutsche Bank and TIAA-CREF reveal that there is no statistical difference between socially-responsible funds and traditional investments. In fact, in some cases, they performed better.

Schedule a discovery call with our firm to learn how we can help align your values with your retirement savings.

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