These sin stocks could be smoking hot bets

With products that keep consumers coming back for more, sin stocks could be a good way to get high returns.

Vikram Barhat 27 October, 2015 | 5:00PM
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The so-called "sin" sector comprises companies operating in the liquor, tobacco and gambling industries.

Due to year-round demand for their products and services, and consumer loyalty based on human weakness, these companies generate heaps of cash, have high profit margins and pay hefty yields. In other words, there are substantial gains to be made by those not averse to investing in these sin-dustries.

According to Morningstar data, brewers as an industry have returned 8.12% for the year to date, and Tobacco stocks have gained a solid 8.32%, compared to a negative 1.94% returned by the S&P 500 Index (all figures as of Oct. 22).

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Anheuser-Busch InBev SA/NV ADR56.10 USD-0.62Rating
Diageo PLC ADR199.94 USD-0.84Rating
Philip Morris International Inc96.29 USD-0.75Rating
Wynn Resorts Ltd90.12 USD-0.90Rating

About Author

Vikram Barhat

Vikram Barhat  Vikram Barhat is a Toronto-based financial writer specializing in investing, stock markets, personal finance and other areas of the financial services industry. He also writes for CNBC, BBC, The Globe and Mail, and Toronto Star.

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