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Who owns tobacco stocks?

Author

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  • David Blitz

    (Robeco)

  • Laurens Swinkels

    (Robeco
    Erasmus University Rotterdam)

Abstract

We compare the ownership characteristics of tobacco stocks with their peers in the same country and industry group. We find lower reported ownership for stocks in the tobacco industry, which suggests that anonymous investors are larger owners of these sin stocks. Compared to peer stocks, US and UK asset managers collectively overweight tobacco stocks, while norm-constrained investors such as sovereign wealth funds and pension funds underweight tobacco stocks. Passive managers have large stakes in tobacco stocks that are in line with the weights of these stocks in broad capitalization-weighted indices, indicating that passive replication of ethically screened indices is still a niche. We also identify some prominent active investors who take large positions in tobacco stocks.

Suggested Citation

  • David Blitz & Laurens Swinkels, 2021. "Who owns tobacco stocks?," Journal of Asset Management, Palgrave Macmillan, vol. 22(5), pages 311-325, September.
    • Handle: RePEc:pal:assmgt:v:22:y:2021:i:5:d:10.1057_s41260-021-00224-2
    DOI: 10.1057/s41260-021-00224-2
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    Cited by:

    1. Brisker, Eric & Wang, Jinjing & Wang, Shuai, 2024. "Why do life insurers hold sin bonds? Evidence from investment delegation," Finance Research Letters, Elsevier, vol. 60(C).
    2. Siri Tronslien Sagbakken & Dan Zhang, 2022. "European sin stocks," Journal of Asset Management, Palgrave Macmillan, vol. 23(1), pages 1-18, February.

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    More about this item

    Keywords

    Divestment; Environmental; social; and governance (ESG); Exclusion; Socially responsible investing (SRI); Sustainable development goals (SDGs); Sustainable investing; Tobacco;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

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