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David Berman

My normal position on ethical investing is usually blunt. As long as a company is abiding by the law, I've always thought it should be fair game for investors.

Now, following the unspeakable horrors at an elementary school in Connecticut – where on Friday a gunman fatally shot 20 children, many as young as six years old, along with six adults – my approach has been shaken: I would not go near a gun stock.

Have I suddenly been reborn as a socially responsible investor, eschewing any investment that runs counter to wholesome living? Not really.

But I have a four-year-old daughter in kindergarten. The tragedy at Sandy Hook Elementary School has shaken me and shown me that there are companies I will not invest in, even if what they produce is perfectly legal.

I only wish more investors felt the same.

The shooting highlights the gap between the laws I would like to see and the laws as they exist today. It is a gap that I'd like to see narrow with sharp restrictions on firearms, but one that remains maddeningly wide even with early reactions to Friday's mind-numbing violence.

That violence is forcing Americans to examine their libertarian policies on guns, which is encouraging. The White House is reportedly working on a proposal to ban assault weapons. Even Senator Joe Manchin of West Virginia, a member of the National Rifle Association, is calling for more restrictions on gun ownership.

And, yes, gun stocks are selling off. Smith & Wesson Holding Corp. and Sturm Ruger & Co., two popular stocks that trade in the U.S. market, have fallen since Friday. On Monday, the stocks fell 5.2 per cent and 3.5 per cent, respectively.

However, the stock market's reaction has to be put into demoralizing context. Investors don't seem all that concerned that the shooting deaths of 20 schoolchildren will be enough to provoke a permanent backlash against gun ownership. The recent declines barely scratch the recent gains on both stocks. Smith & Wesson is still up nearly 100 per cent this year while Sturm Ruger is up more than 40 per cent, and that is with a hefty special dividend of $4.50 (U.S.) a share arriving at the end of this week.

If the stock market isn't betting on drastic legal changes ahead, it has good reason: Other mass shootings have done little to change firearms laws.

Previous restrictions have been allowed to lapse or have attempted to keep guns away only from certain people, such as felons.

Attitudes are hard to change. According to a survey by Pew Research Center for the People and the Press, views on gun regulation barely shifted after the mass shooting in Colorado in July, which left 12 people dead. Three months before the shooting, 49 per cent of those surveyed believed it was more important to protect the rights of Americans to own guns than control gun ownership. After the shooting, that percentage fell all of three points. Meanwhile, the pro-gun views are up from 32 per cent just five years ago, meaning that Americans have rarely been so enamoured with firearms as they are today.

I have never invested in a gun manufacturer. And until firearms are limited to the military, the police and legitimate hunters, I never will.