“Never” is a long-term commitment. This also applies to ‘forever’.
Stocks and other investments become more powerful the more time you give them, but even famed long-term investor Warren Buffett sometimes makes temporary bets. Me too, and probably you too.
Do you miss the morning spoon? Wake up with Breakfast news in your inbox every market day. Register for free »
However, a few tickers in my portfolio have a permanent home there. I don’t plan to sell these stocks and funds until I retire and can live off my savings. Maybe I’ll nibble on it every now and then, taking profits or rebalancing my portfolio when the time is right, and nothing is ever 100% certain when I plan decades ahead.
But I’m pretty sure these names will stay in my portfolio forever, for all practical purposes.
Every portfolio needs a solid foundation of market-tracking funds. Among the many popular options is the Vanguard S&P 500 ETF (NYSEMKT: VOO) plays that role in my portfolio.
This exchange-traded fund (ETF) reflects the classic S&P500 (SNPINDEX: ^GSPC) market index. It is a large portfolio covering every conceivable sector and industry, focusing on high quality US stocks. Vanguard funds come with strong liquidity, vanishingly small annual fees, and the legacy of index fund genius Jack Bogle.
There are a few other ETFs in my portfolio, but only this one will be there until the end. If you look up “stable, predictable, and reliable” in your investor dictionary, this fund will be the top pick.
Moving on to the individual stocks, only a few names deserve a spot on this list.
The first among them is Google’s parent company Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL). What started as a student project in a Stanford garage has grown into one of the largest and most valuable companies in the world. Along the way, the Internet-heavy Google company transformed into the umbrella Alphabet company, preparing the organization and its investors for dramatic market shifts in the future.
Online search and advertising is still Alphabet’s core business, but the company is already exploring alternatives such as medical research, a self-driving taxi service and a cloud-based collection of artificial intelligence (AI) tools. Web and mobile app advertising won’t pay the bills forever, but this company is ready to transform into something else as the market evolves.
If this ultra-flexible management approach can’t help Alphabet stay relevant and profitable for at least thirty years, I’ll buy a hat and eat it. This is the safest single-ticker investment I can think of.
Next up is a fellow tech giant Amazon.com (NASDAQ: AMZN). Amazon is backed by a huge base of e-commerce business and is always ready to move in new directions. The company is already a leading name in cloud computing and AI services, not to mention its world-class transmission network and award-winning media studio.
From smart home devices and audiobooks to luxury grocery stores and online pharmacy services, Amazon’s portfolio of products and services is almost as impressive as Alphabet’s. The management team is known for running Amazon like it was “day one” for a brand new startup, even though it is a trillion-dollar company with decades of operating history.
Once again, flexibility is the secret to a long and prosperous business history. Amazon has it in abundance, and I trust this stock to deliver solid gains for the foreseeable future.
This might come as a surprise, given the focus on extreme stability in the first few picks. But I would argue that SoundHound AI (NASDAQ: SOUND) could eventually become the next Alphabet or Amazon.
It’s a radically overpriced small-cap stock these days, and I recommend letting the stock cool off a bit before buying your first SoundHound AI stock. It trades at 76 times sales as of Dec. 6, buoyed by a weeks-long meme stock campaign. But keep an eye on SoundHound AI when the price spike disappears, as it surely will in the near future.
I’m talking about an unparalleled AI innovator building a huge list of high-profile clients ranging from automakers and restaurants to designers of consumer electronics and phone menu systems. SoundHound AI isn’t the only name in the game, but the company’s services are based on AI research and data collection. Several tech giants have shown how difficult this task is by shelving their own research and buying experts like Shazam or Dragon Naturally Speaking.
I imagine someone might also want to purchase SoundHound AI, but I never rely on that kind of speculation. Voice-controlled devices are already popping up everywhere. The market is worth approximately $140 billion today and should grow into a trillion-dollar revenue opportunity over the next decade. I want to own the leading name in this revolution.
Again, I don’t recommend buying the overheated SoundHound AI stock today. Let it cool before building a robust position. If you assume a more reasonable price and valuation, SoundHound AI stock should serve you well in the long run.
I’m pretty sure that cryptocurrencies will one day disrupt financial systems and traditional payment methods. Hardly anyone uses cryptos instead of dollars in their daily lives anymore, but that day will come. If so, I don’t want to beat myself up for failing to grab some Bitcoin (CRYPTO: BTC) while it was new and cheap.
That may sound like a joke, considering Bitcoin just surpassed $100,000 for the first time. That’s not “cheap” unless you have caviar for breakfast and a new car every Thursday.
But you could have said the same thing when Bitcoin retreated from $64,000 per coin in 2021 or when it peaked just below $20,000 in 2017. The difference this time is that the financial world is taking crypto seriously and digital assets are readily available in the form of spot Bitcoin ETFs.
I don’t know what a Bitcoin could cost in 2025 or 2030. And this is not a risk-free idea, as new innovation can disrupt the crypto market and the Bitcoin platform at any time. Still, the era of fully digital finance is coming, and Bitcoin is the closest thing we have to a stable, long-term bet on that unstoppable trend. Therefore, I expect to own Bitcoin and/or Bitcoin-based funds “forever.”
Maybe you expected an elaborate, eternal affair for some of my biggest winners. I made more money with the media streaming pioneer Netflix (NASDAQ:NFLX) and innovator in the field of robotic surgery Intuitive surgery (NASDAQ: ISRG) than anything, and you’ve seen me sing their praises over the years. Perhaps you wanted a long-term investment thesis for more recent ideas or turnaround stories with strong prospects into the distant future. Media platform expert Roku (NASDAQ: ROKU) consider this together with the developer of restaurant management software Toast (NYSE: TOST).
All of these names deserve your consideration, and some could be great buys today. I’m just not entirely sure I’ll own them forever.
The forward-looking growth ideas involve significant risks and intense competition, while the proven winners may saturate their target markets and run out of breakthrough ideas within a decade or two. A 10-year position isn’t close enough to qualify for this list of perpetual investments.
That’s why I’m talking today about these hand-picked survivors. They may not be flashy get-rich-quick ideas, but they can still build wealth for decades to come.
Amazon and Alphabet are flexible and have enough money to belong on this list. The Vanguard fund – or another broad market tracker – could easily be the only holding in an effective retirement portfolio. I think Bitcoin is important and groundbreaking enough to have a seat at every table. And SoundHound AI may seem out of place here, but AI-powered voice control should one day be a trillion-dollar market.
Have you ever felt like you missed the boat on buying the most successful stocks? Then you would like to hear this.
On rare occasions, our expert team of analysts provides a “Double Down” Stocks recommendation for companies they think are about to pop. If you’re worried that you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
-
Nvidia: If you had invested $1,000 when we doubled in 2009, you would have $350,239!*
-
Apple: If you had invested $1,000 when we doubled in 2008, you would have $46,923!*
-
Netflix: If you had invested $1,000 when we doubled in 2004, you would have $492,562!*
We’re currently issuing ‘Double Down’ warnings for three incredible companies, and another opportunity like this may not happen anytime soon.
See 3 “Double Down” Stocks »
*Stock Advisor returns December 9, 2024
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, a director at Alphabet, is a member of The Motley Fool’s board of directors. Anders Bylund has positions in Alphabet, Amazon, Bitcoin, Intuitive Surgical, Netflix, Roku, SoundHound AI, Toast and Vanguard S&P 500 ETF. The Motley Fool holds positions in and recommends Alphabet, Amazon, Bitcoin, Intuitive Surgical, Netflix, Roku, Toast, and Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.
5 Beautiful Investments I “Never” Sell was originally published by The Motley Fool
