The Christian and The Stock Market

My intention in this article is not to debate the actual nuts and bolts of stock market investing.  I’m hoping you will allow this post to be more philosophical in nature.  The basic premise that I want to examine is this:  Investing in the stock market is amoral.  It is neither good nor bad. 

Is the above statements truth for the Christian?  Should the Christian view the stock market the same way the unbeliever views the stock market?  I’m not sure I have all the answers as I’m struggling with this in my own mind, but I’ll try to explain my thinking in the hopes of starting a larger overall discussion among Christians.

What is the Stock Market?

From Investopedia:  “The market in which shares are issued and traded either through exchanges or over-the-counter markets. Also known as the equity market, it is one of the most vital areas of a market economy as it provides companies with access to capital and investors with a slice of ownership in the company and the potential of gains based on the company’s future performance.”

In terms you and I can understand:  I want to purchase some ownership in a publicly traded company.  I fork over my cash in exchange for a small ownership percentage in the publicly traded company of choice.  That company will take the cash and invest it within the business hoping to create a return on the cash that investors like me gave to them.  I am willing to exchange the cash now hoping for future payments back to me from the company’s earnings (dividends).  I’m also hoping that the stock I purchased increases in value.

So What’s the Problem?

The question that keeps plaguing my mind is the business practices of the companies I’ve invested in.  Now, if I were to deliberately hand pick every single stock that I decide to purchase, I might be able to determine if the company does business in a way that brings glory to Christ as that should be the basis for all of the Christian’s decisions.

But the reality is that most people of modest means do not invest in the stock market by purchasing individual shares of stock.  Most people, through 401(k)s and IRAs, invest in mutual funds and index funds.  A mutual fund is simply a collection of many different types of stocks and bonds.  So instead of buying shares of McDonald’s Corp, I buy shares in Mutual Fund Company ABCD.  ABCD then pools all of the money from the individual investors (investors like you and me) and purchases stocks, bonds, and other securities from multitudes of individual companies.

I Still Don’t Get It?

Here’s my delimma:  If ABCD Mutual Fund Company invests the pooled money in 1,200 individual companies, does the Christian have any responsibility to scrutinize the practice of those 1,200 companies?  I would answer that with a resounding, YES!

Here’s why:

What if one company produces pornography to make their profits?

What if one company specializes in producing the morning after abortion pill?

What if one company is known for illegal activity and corruption?

Should these types of questions concern the Christian?  What is your take on investing in something without knowing the underlying consequences of making the investment?  How can we feel justified knowing that our money could be helping to further practices that the Lord hates? 

These are the types of questions I’ve been struggling with lately. I would appreciate your thoughts!