The Rules of Investing The secret to finding stocks you can hold for 20+ years
Sep 13, 2024
48:59
While Warren Buffett's favourite holding time may be forever, the average holding period for a typical investor is now just 5.5 months. In a world where news, analysis and investment ideas are readily available at our fingertips, investors have quickly forgotten the benefits of long-term compounding and instead are focused on the next great stock, driven likely by their fear of missing out.
We've all succumbed to it, there's no point denying it. How many of us jumped on the buy-now-pay-later trend, the lithium trend, the uranium trend, and now, the AI trend, as stocks soared to stratospheric heights? How many of us have attempted to hold on for dear life (HODL) as some of these companies crashed back to Earth?
So, how can you identify the companies that continue to win over the long term? And by long term, I don't mean five-plus years, but 20.
In this episode of The Rules of Investing, Janus Henderson's Josh Cummings outlines what makes a winning long-term stock - a process that has helped the team top the league tables for their consistent outperformance over the last five and 10 years - and provides a few examples.We also take a deep dive into artificial intelligence - and why Cummings believes AI will become even larger, more pervasive, and more impactful on our lives than we could ever conceive of today.
https://www.livewiremarkets.com/wires/the-secret-to-finding-stocks-you-can-hold-for-20-years
Timecodes
0:00 - Intro
2:16 - The secret to consistent long-term outperformance
3:30 - What the team got right and wrong over the last 12 months
4:38 - The impact of AI on mega-cap tech companies
7:19 - Is there too much "faith" in the AI theme?
9:48 - Is this the death of value investing?
11:58 - What it's like on the ground in the US right now
15:14 - Impact of cumulative inflation on businesses
18:13 - Nvidia's antitrust charges
20:42 - Factors that can help investors identify consistent winners
22:58 - Celebrity CEOs and red flags
25:20 - Should you really HODL?
26:58 - Smaller companies employing disruptive innovation
31:13 - Lessons from the team's meeting with OpenAI CEO Sam Altman
33:49 - Innovation is a scale game - why the big are only going to get bigger
35:01 - What could go wrong with AI (i.e. are we in for an iRobot scenario)
40:22 - Two things investors are getting wrong today
42:36 - Why you should invest in what you know (and trust your gut)
46:45 - One stock Josh Cummings would own if the market closed for 5 years
0:00 - Intro
2:16 - The secret to consistent long-term outperformance
3:30 - What the team got right and wrong over the last 12 months
4:38 - The impact of AI on mega-cap tech companies
7:19 - Is there too much "faith" in the AI theme?
9:48 - Is this the death of value investing?
11:58 - What it's like on the ground in the US right now
15:14 - Impact of cumulative inflation on businesses
18:13 - Nvidia's antitrust charges
20:42 - Factors that can help investors identify consistent winners
22:58 - Celebrity CEOs and red flags
25:20 - Should you really HODL?
26:58 - Smaller companies employing disruptive innovation
31:13 - Lessons from the team's meeting with OpenAI CEO Sam Altman
33:49 - Innovation is a scale game - why the big are only going to get bigger
35:01 - What could go wrong with AI (i.e. are we in for an iRobot scenario)
40:22 - Two things investors are getting wrong today
42:36 - Why you should invest in what you know (and trust your gut)
46:45 - One stock Josh Cummings would own if the market closed for 5 years