Monday, September 22, 2014

Death, Destruction, Poverty and Addiction - or - Where to invest a wad of cash.

Death, Destruction, Poverty and Addiction - or - Where to invest  a wad of cash

In the (financial) Spring a middle-aged man's fancy lightly turns to investment returns.

What with Russia invading Ukraine, ISIL spreading like wildfire across at least 2 countries, continuing instability in Iraq, Afghanistan, Pakistan, Somalia, conflicts with the Uighurs in China, Boko Haram in Nigeria ... and the increasing tenor of military crisis and forcefulness in combating these powers, I got to wondering what investment potential currently exists among the arms manufacturers. I started by looking up the 10 largest arms manufacturers.

As it happens, 7 of the top 10 are American companies, as are 5 of the top 6. Starting at the top here is what I found. In each case I compared it to the S&P500, which has risen by 42% since 4 January, 2013.

1. Lockheed Martin, up 96.7%
2. Boeing, up 54%
3. BAE Systems, up 41.5% ... British company
4. Raytheon, up 81%
5. General Dynamics, up 89%
6. Northrop Grumman. up 98.8%
7. Airbus Group, up 67% ... EU company
8. United Technologies Corporation, up 32.4%
9. Finmeccanica, up 71.9% ... Italian company
10. L-3 Communications, up 49.9%

The above returns do not include dividends, which are significant. All but one of the top 10 companies seriously outpaced the S&P500.

Conclusion? War still makes money.

In future research I will look into the profit potential of Casino companies, Alcohol makers, cigarette makers and payday loan companies.

scripturam hanc , et plorate