There is one statement that many investors follow when investing in securities: investments in the stock market and risk go hand in hand. And this statement is quite justified because the probability of losing money transferred to management at interest is very high. This risk is especially high in times of crisis when prices are falling relentlessly. In this case, the investor has to either fix losses or limit himself to constant payments of interest income.
However, successful investors try not to focus on market changes. This tactic follows a different rule: they buy the best stocks, but they never sell them. Long-term holding of shares is one of the most successful methods in the field of investment. One great investor, Philip Fischer, in his book "Ordinary shares and extraordinary returns", said that there is no better time to sell shares than "almost never".
In order to generate a tangible cash flow before your own pension, you need to keep some assets in your investment portfolio forever. This is an opportunity to spend dividend income or, if there is no need for passive income, re-invest this money.
The concept of "perpetual" shares implies securities that can provide dividends to the investor, and these dividends do not depend on the state of the economy, peaks, or dips. Even war or depression in the state can not affect the payment of part of the income of the selected company. Indeed, the stability of some companies is like an ATM that never runs out of funds. In the long-term investment sector, there are a large number of giant companies whose products are firmly embedded in the minds of people and are extremely necessary and irreplaceable by any analogues. As an example, let's take a look at three popular brands.
The well-known Coca-Cola, which, despite the complexity of the business from the consumer sector, has been writing checks to its shareholders for more than a hundred years. Trade in food and beverages has always been characterized by fierce competition and required the constant introduction of innovative chips. However, Coca-Cola stands up to the obvious pressure with a bang. Moreover, it is a guarantee of strength and a vivid example of the brand's longevity.
Even in the context of the COVID-19 pandemic, when the brand has actually lost sales in public places, the company still maintains a strong balance sheet, and the management does not lack liquidity.
Fashion for a healthy lifestyle, the cult of healthy food also left an imprint on the demand for the usual sweet drinks from Coca-Cola. In this regard, the company has followed new trends and expanded the range of healthy products. This move beyond the brand of the same name is a necessary measure and a necessary condition for keeping the company in a leading position. Moreover, to maintain its status and high level of sales, Coca-Cola is acquiring various young companies, which is essential for following a healthy trend and finding new growth potential. Here is an example of recent brand investments: Honest Tea, Fairlife dairy, and Suja Life LLC. Public figures show that Coca-Cola's quarterly dividend is $0.41 per share and has more than doubled over the past five years.
As for clothing brands, there are quite a lot of obvious leaders in this sector, the variety of strong brands is amazing and meets many consumer needs. For example, the sportswear company Nike claims to be a worthy and reliable candidate for inclusion in long-term investment portfolios. From a financial point of view, this is a very stable company that is also able to withstand the pressure from the ill-fated pandemic. The brand has successfully applied its e-Commerce channels to minimize financial losses due to the closure of retail outlets during the quarantine period. This is why wall street analysts recommend that customers not get rid of Nike securities, explaining this as an excellent potential for long-term growth of the brand and pointing to its clear success in the digital space. Nike's quarterly dividend is $0.245 per share and offers a yield of 0.80%. Moreover, this yield has been rising regularly since 2004.
In addition to food and clothing, the Internet and wireless technologies are a necessary sector of the modern consumer. This is the sphere of human activity that has become of unprecedented importance over the past decade. It is difficult to overestimate the importance of information technology, wireless Internet, mobile communications, and television. It is not only a source of information, but also a universal environment for communication and learning. Every day the number of Internet users increases. That is why telecommunications companies are the same eternal assets, or one of the integral parts of the long-term investment sector. It doesn't matter what the current state of the economy is, because the Internet and wireless technologies are the last thing consumers will give up.
Verizon Communications is one of the largest telecommunications companies in the world, which has been increasing its dividend for the past 30 years. Verizon has offices around the world, and has a revenue of $131.9 billion as of 2019. The company's range of services includes voice, data, and video solutions across award-winning networks and platforms. The company's quarterly payouts have increased by more than 50% since its stock first appeared on the market in 2000. To date, Verizon's stock is worth $0.6275. At a price of $60.37, the company's annual return is 4.14%. And this is despite the fact that the average indicator of companies from the S&P 500 list is 1.7%.
Technological breakthroughs are extremely important for the dynamics of growth and development. And in this direction, the next important step for Verizon will be the construction of a 5G network, on which the success of futuristic destinations largely depends. In the near future, concepts such as self-driving cars, smart homes, or remote surgeries will become an integral part of modern life and will acquire the same status of things necessary for human life as food or clothing.
Companies with clear competitive advantages and stable market positions are always the most profitable in terms of dividends for investors. Their undeniable advantage is the ability to remain stable in the face of economic downturns and the desire to surpass the trends of the rest of the market in the long term. To invest in such companies is to invest in your future.
