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 The_Zen_Trader_for_Euni.pdf

The methods I have been discussing and the results displayed on other pages have given no consideration to what a company does to produce earnings. Trading buy signals give no  reasons “why” a share is performing as it is. Systems are often based on momentum of price and volume.

However, some people are deeply concerned about a company’s effect on the environment and the social impact of a company's policy. Our trading rules may trigger a buy in a gambling company - you may be passionately opposed to gambling. You may also feel strongly opposed to alcohol and consider it a social problem and do not want to support companies in this sector. If so you can do your own screening of stocks to suit your personal beliefs.

For example, for many years I traded the gold market particularly gold shares.

Mining is a controversial issue and I agree with the concerns of many. For example some years ago Newcrest Mining of Australia bought out Lihir gold of Papua New Guinea. Lihir has a horrid environmental record in that country in regard to polluting river systems and for that reason I would not buy it. Hopefully Newcrest is doing a better job.

As a child I lived in New Guinea and remember swimming in the rivers with children of that country. I don’t like the thought that no longer will those rivers be pollution free, because we in western economies support a company with little concern for social liberties.

This is my choice, we all need to make our decisions and live with them. It is possible to still make money and trade well by being a little selective.

Below is a guideline as to what to look for before deciding to invest in a company, more information can be found on the ASX website or by googling a companies website for its ethical protocol.

Ethical Criteria 

  1. Environment:Avoids companies related to pollution and environmental degradation. Positive screens for pollution reduction and environmental remediation and preservation.
  2. Human Rights:Avoid companies with human rights issues.
  3. Workplace:Positive screen for employment standards.
  4. Arms:Negative screen for militarism and armaments.
  5. Social Health:Negative screen for social justice and positive screen for community development.
  6. Aboriginal:Avoid companies with human rights issues
  7. Corporate Citizen:Negative screen for product and advertising integrity and financial speculation.