This Stock Is a Perfect Stocking Stuffer

Palm Beach Daily

This Stock Is a Perfect Stocking Stuffer

By Grant Wasylik, analyst, Palm Beach Daily

If you’re still hunting for last-minute holiday gifts for loved ones, this idea could save the day…

It’s better than traditional stocking stuffers like ties, cheap jewelry, candies, or other sundries. And it’s just as easy to buy.

While your family members might not get instant gratification from it, they’ll be thanking you years and decades down the road…

Before we get to this idea, let me show you how we selected it…

Holiday Shopping for Stocks

To find this gift idea, we used a strategy that’s crushed the S&P 500 by 1,565% over the last two decades. And even during the market’s worst crashes over the past 20 years, this approach achieved positive returns.

We call it the “Untouchables” strategy. That’s because over the long term, these stocks are so safe and profitable… you’ll never want to touch them.

I started my research on untouchables by looking at every major bear market over the last 20 years. I combed through thousands of companies for those that soar when the market rises – but only grudgingly give ground when it falls.

I studied every calendar year. I wanted stocks that hadn’t dropped 10% or more in any single year since 2000. In other words, stocks that fought through each year without going down by double-digit percentages.

You see, small losses aren’t a big deal. If your initial loss is 10%, you’ll need just an 11.1% gain to break even.

But big losses are ruinous. They’re hard to recoup. If your initial loss is 50%, you’ll need a 100% gain to break even.

So unlike other stock-picking methods that can expose you to 30–50% drops during bear markets, this one stays afloat even in the worst sell-offs.

Even during the worst calendar years for the markets in the last two decades (including those brutal bears), our Untouchables strategy crushed it:

  • It was up 4% in 2000 when the S&P 500 was down 9.1%.

  • It was up 6% in 2001 when the S&P 500 was down 11.9%.

  • It was up 1% in 2002 when the S&P 500 was down 22.1%.

  • It was up 2% in 2008 when the S&P 500 was down 37%.

  • It was up 2% in 2018 when the S&P 500 was down 4.4%.

As you can see, holding these types of stocks will help you sleep well at night. They also have these three common traits:

  • They haven’t dropped 10% or more in any calendar year since 2000 (as calculated between the prior year’s closing price and the following year’s closing price – dividend included).

  • They trade with extremely low volatility, so they’re ultra-safe.

  • Their returns have significantly outrun the broad market over the long term.

Plus, they all pay dividends.

But only a tiny fraction of the 19,000-plus publicly traded stocks in North America pass these criteria. Just 14 (0.07%) made our list.

And you can see in the charts below that this group crushed the S&P 500 in a safe way. (Notice the wavy line on the left compared to the steadfast rising line on the right.)

Click to enlarge

Over the last 19 years, the S&P 500 had a cumulative return of 143%. Meanwhile, in the same time, our 14 Untouchables returned 12 times that – for an average of 1,708%.

Keep in mind, you’d have to hold these stocks over that entire 19-year stretch to realize these returns. And past performance doesn’t guarantee future outsized returns.

But we’re confident these Untouchable stocks will continue outperforming the market…

The Gift That Keeps on Giving

If you want to add an untouchable stocking stuffer, consider healthcare giant Johnson & Johnson (JNJ). It meets all our criteria… plus it’s raised its dividend for 57 years in a row (it currently yields 2.7%).

As a gift, it works perfectly for your children or grandchildren.

You’ll need to set up a custodial account for them. Then buy the stock in your own brokerage account and have it retitled. For best performance, we suggest you use a direct stock purchase plan (DSPP) or dividend reinvestment plan (DRIP).

If you want to learn more about gifting shares to loved ones, websites such as Stockpile and GiveAshare can help you get started. Remember, always do your due diligence.

Ideally, the earlier you get a loved one started, the better. The more time the money has to earn, the greater the opportunity for compounding.

This is truly a gift that keeps on giving.

Regards,

Grant Wasylik
Analyst, Palm Beach Daily

P.S. Do you plan to give your loved ones stocks for the holidays? Let us know right here


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IN CASE YOU MISSED IT…

He set out to make $70,000 live on camera… What happened next left us speechless.

Did you catch this interview with Market Wizard Larry Benedict last Wednesday night?

Keep in mind: This guy was named by Barron’s as a top 1% hedge fund manager 3 separate times… Generated $274 million in bottom-line profit over an 8-year period… and was featured in the famous book series Market Wizards, right after the chapter on billionaire Ray Dalio.

There’s very little left for Larry to achieve in the financial space…

Yet, he still put his entire reputation on the line last week

He wanted to challenge himself. So he attempted to generate $70,000 or more in a single trading day.

If he won, he said he’d give all of the money – every penny – to a local charity. If he lost, we agreed to show that, too.

Did Larry win or lose? And by how much?

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