Investing News Roundup

On a miserable January in the market, a new China fund, some green alternatives, and the surge in tobacco stocks.

By SHARE

Last month was the worst January in history for the Nasdaq.

It also ranked near the middle of the S&P's 10 worst Januaries.

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It's not just the big companies that will profit from China's explosive growth. Here's a new fund that focuses on the little guys.

Take heed, though: So far this year, China funds account for five of the 10 worst-performing funds in the international category, according to Morningstar.

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Attention, green investors: Pax World Funds—the Portsmouth, N.H., firm that launched the first socially screened fund in 1971—has plans for three new funds. The company has filed prospectuses with the Securities and Exchange Commission for Pax World Small Cap, Pax World International, and Pax World Global Green. Small-time investors should also take note, because Pax requires only $250 to invest in its funds.

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Now, for a not-so-green topic: tobacco. The Crossing Wall Street blog charts the dramatic surge in tobacco stocks since the Master Tobacco Settlement was signed. Which reminds me of a conversation I had with Charles Norton of the Vice Fund the other day. His response to my question about the impact of smoke-free legislation on tobacco stocks:

The tobacco business hasn't been as good as it is today in many years. We like sectors like this that are highly regulated, because regulation causes a high barrier to entry. Consumption in the U.S. is in steady decline, there's no doubt, and smoking bans are part of that. But these companies have tremendous pricing power, so they can offset declining volumes. Combine the very low cost of production—about 25 cents per pack—with pricing power, and you have a tremendously profitable business.