"I just started reading The Future For Investors by Jeremy Segal. If one is looking long-term, and by that I mean a few decades or more, he not only supports the findings of Lowell Miller, in The Single Best Investment, but he makes some very good points on the types of companies to own.
The best companies to own are the companies selling the same product today that they sold 50 to 100 years ago. If a product continues to be purchased, through thick and thin over that length of that time, then it must be in demand. Anything in demand, if managed properly, will show high returns over the long-run.
One of the very basic things that people can not do without is food. It doesn't matter what is going on in the world, economically or politically, people have to eat. Kraft, in it's original form, and if all of the spin-offs were held and dividends reinvested, was one of the top five market performers over the last 50 years. When you stop and look at all of the market leading brands that they sell all over the world, they can't help but show good returns over the long-run.
XOM and MO and the spin-offs with dividends reinvested, along with KRFT were among the top five total return companies over the 50 year study performed by Segal. And, a young person should seriously consider reinvesting all dividends and let the power of compounding grow that income stream from each company."...
Really? So much can change in 50 years. I would suggest a exchange based mutual fund. It would be interesting to look at who was on the Dow 50 years and remains in business, IBM, GE, but some others have gone through major changes like GM and Chrysler.
Thomas Sowell: There are no solutions, just trade-offs.
That was my first thought FH. Changes are occurring so fast that many businesses are no longer viable. Perhaps over the long term invest some but not all in the old reliables. We have found that investing in local young people who have been thoroughly vetted often times through franchises will bring a much larger return. Being a silent partner with a tight contract is a must so that if things go south and bankruptcy becomes an issue you are a secured creditor. But with a thorough vetting process that doesn't usually happen.
RidgeWay wrote: That was my first thought FH. Changes are occurring so fast that many businesses are no longer viable. Perhaps over the long term invest some but not all in the old reliables. We have found that investing in local young people who have been thoroughly vetted often times through franchises will bring a much larger return. Being a silent partner with a tight contract is a must so that if things go south and bankruptcy becomes an issue you are a secured creditor. But with a thorough vetting process that doesn't usually happen.
That is some high risk high reward investing, but my company started that way too. Just a couple guys with some good ideas who developed products to sell to their former employers.
Thomas Sowell: There are no solutions, just trade-offs.
