What Is the Vice Fund?
Let me explain the Vice Global Fund to you directly—it's a mutual fund run by USA Mutuals that puts its money into vice industries, the kind often labeled as socially irresponsible or 'sin stocks.' Before this specific fund came along, 'vice fund' was just slang for any fund heavy in these types of investments. It went by Vitium Fund for a while, renamed on May 23, 2019, but switched back to Vice Fund on August 4, 2021.
Key Takeaways
You should know that the Vice Global Fund, once called the Vitium Fund, targets vice industries seen as socially irresponsible. It invests mainly in stocks where most revenue comes from alcohol, tobacco, gaming, and defense. The name changed to Vitium Global Fund on October 1, 2019, and reverted to Vice Fund on August 4, 2021.
Understanding the Vice Fund
The Vice Fund invests primarily in stocks that get the bulk of their revenue from alcohol, tobacco, gaming, and defense sectors. This includes casino operators, gaming equipment makers, defense manufacturers, alcohol producers, and tobacco companies. It covers both domestic and foreign equities, from small-cap to mega-cap firms, and has been operating since 2002. Between May 2014 and October 2016, it was called the Barrier Fund.
I focus on high-quality dividend-paying stocks in these vice industries because they have strong barriers to entry, making successful companies a dependable source of returns. These investments are generally market-neutral, performing well in both up and down markets due to consistent demand for vice goods throughout economic cycles. The fund is diversified internationally to sidestep broad market volatility, and it emphasizes companies with positive cash flow for income payouts to you as an investor.
Investing in the Vice Fund
The Vice Global Fund operates as an open-end mutual fund with four share classes: A, C, investor, and institutional. It carries a management fee of 0.95%, with total annual operating expenses between 1.24% and 2.24% (net expense ratio). You can trade it through full-service or discount brokerages. Institutional and investor classes have no sales loads, while A-shares have a 5.75% front-end load and 1% back-end load via full-service intermediaries. C-shares only have a 1% contingent deferred back-end load in the first 12 months after purchase.
The fund has shown steady annual total returns, with dividends playing a key role. As of June 30, 2022, the Investor Class posted a five-year annualized return of 0.74% and a 10-year return of 6.79%. Since inception, its annualized return is 7.82%, compared to 8.32% for the MSCI All Country World Index benchmark. On September 9, 2022, the dividend yield was 0%.
As of September 9, 2022, total assets under management stood at $79.2 million. Top holdings as of June 30, 2022, included Galaxy Entertainment, Northrop Grumman, Raytheon Technologies, and Philip Morris International.
