The Financial Ombudsman Service has been criticised for an article it published in its own magazine.
Following a complaint the FOS had handled, they pointed out that certain ethical investments were higher risk.
Obviously, companies that offer ethical investments do not want their products labelled as higher risk, hence the criticism.
Our View
Our view is that any investment is high risk if you do not understand it. Many ethical investments are not high risk but anything linked to the profits of companies or individual stocks and shares does carry risk of capital loss.
Many investors have strict investment views and will not invest in companies linked to, say arms, alcohol or tobacco. However, investments that avoid these products can sometimes fall behind in the performance stakes.
If you are thinking of investing anywhere you must understand what you are buying. If you do not ask questions but invest anyway, you only have yourself to blame. Remember, you are the customer and it is your money! Don't feel silly for asking questions about an investment - it should be there to make you money, not lose it, unless you are prepared to lose.