What exactly is a sin stock anyway?

The traditional definition of sin stocks has been simple: booze, cigs, scantily-clad women, and gamblin'.

But now some traditionally socially responsible companies are backtracking. According to The Wall Street Journal, KLD Research & Analytics, a socially conscious indexing firm, has launched a new Global Sustainability Index (subscription required) that uses a point system of sorts to include or exclude companies based on environmental impact, corporate governance, and the nature of their products. Some companies that sell liquor or operate casinos have made the list. Even Pax World recently dropped its zero-tolerance policy for alcohol and tobacco stocks.

The shift is a result in the shift in the definitions of morality and social responsibility. Originally, many of these funds targeted social conservatives who found gambling and pornography distasteful. The target market now seems to be the environmentally and socially conscious.

Of course, there are different funds for people with different ideologies. There's even a special fund for Democrats! For my profiles of a few off-beat funds investing based on SRI criteria, check out Invest with Your Politics.