Investing in a company is, in a real sense, providing them money. Stocks aren’t pretend money totally separate from corporate finances, they are intended to provide capital for expanding a business. If it goes well, the company makes money, the value goes up, and you can sell at a profit. If it goes poorly, you can lose up to 100% of the money you spent to buy the stock. That’s why it’s “investing.” You make it sound like a dog track where the money you put in has no actual effect on the outcome of the race, but that’s not true.
Even if it were true, where is the line? If I come to you with my meth business, a proven track record, and a high potential rate of return and I just want money to help expand, you would consider that a good business? What if it’s assassination? Suppose it’s a totally legal banana company but also they moonlight in overthrowing democracies?
It may be that my literal dollar bill that I invest does not end up in the hands of a guerilla, but in helping dump money into the company I am helping enable the behavior. In this scenario, I think figuring out who is legally culpable and should have known is impractical and the risk is too high of innocent people ending up in jail for us to lock up shareholders, but losing the money invested is absolutely a risk you take when investing, and if people lost their money more often they’d probably pay more attention and it would be a net good.