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Hot Global Stocks

Money in the stock market is made by top innovative firms. Sharp vigil investors get to see their might early, and reap the harvest of huge returns. Big names matter but only up to a point. Punch line seems to be...

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If you are a buy and hold global Investor, which 20 stocks would have ROLLED your $100 investment in December 2009, more than 11 times, by December 2019. Marketwatch did a precise study of this, for all S&P stocks that have traded for the last 10 years. It calculated the total returns of each such stock from Dec 2009 to Dec 19, accounting for reinvestment of all dividends received. Surprisingly, Only 3 international brands made the list...Netflix at the top, Amazon in the middle at no 10, and Mastercard towards the end at no17.

So much for global brand value!!!

Just goes to show that big financial returns come from novel products, that hit a large chunk of consumers. Netflix is a household name catering to daily entertainment..hence is right at the top providing a whopping 38.7 times ROI. The other household name Amazon is way down but not out, giving 13 times return to its valued investors.

Liquor lovers may spot Constellation Brands with Corona at top of memory recall, at serial no12, rolling your funds a dozen times. Housewives who know Discount dept store chain Ross Stores may find it equally rewarding if they invested in it. Mastercard company investors also get approximately the same dozen times to return. For heavens' sake then, what are the other big brand names doing, to their loyal investors. At least not whetting the investor's appetite.!!!.

Marketaxess Holdings is stationed at no 2, as it provides a global electronic bond trading platform, obviating the hitherto need of October transactions. Returns are a mouthwatering 33 times in last 10 years. Another big innovator is at no 3, Abiomed Inc, producing life-saving medical devices that provide circulatory support. Its smallest heart pump Impella is a joy for 50000 patients in USA.No wonder the returns are commensurate with this....22 times your investment. 4th place is taken by another exciting firm Transdigm group, which manufactures specialized products for the aerospace industry. Set up 15 years ago, Visual Capitalist reports that it acquired 60 businesses in such a short span, rewarding investors handsomely, with returns in excess of 21 times in last decade. Who would have imagined these firms beating the hell out of grandmasters like Apple and Microsoft?.

Serial 5 to 9 top performers are also unknown companies for most ...yet allow you the luxury of 13 to 20 times ROI. An IT novice, BROADCOM INC at s no 5, has given 2000% returns, way beyond most other household names. Similarly ALIGN TECH INC at number 6 position & REGENERON PHARMA at s no 8, both in the health care sector, boast of 1500% returns. UNITED RENTALS in the Industrials category, also exhibits the same returns, at s no 7. In the consumer discretionary list, ULTA BEAUTY INC, bags the 9th place churning out the same returns as Amazon ..1300%. No finance class in any b school would even know about some of these companies, even though they have beaten the S&P INDEX hollow, despite being a part of it!!!

The list from rank 11 to 20, has only 1 household name Mastercard, and yet they deliver returns of 11 to 12 times your investment. I bet most readers have not heard of firms who occupy vintage positions like

EXTRA SPACE STORAGE INC
NVIDIA CORP
TAKE-TWO INTERACTIVE SOFTWARE
FORTINET
CHARTER COMMUNICATION INC
O'REILLY AUTOMOTIVE INC or
CINTAS CORP.

A question that emerges is which sectors do these 20 top firms get classified in?
5 of them are in IT, 4 in consumer discretionary, 3 each in industrial & health care, and 2 in Communication Services. Sole contributors are from real estate, financials and consumer staple sectors.

Moral of the story is clear. Money in the stock market is made by top innovative firms. Sharp vigil investors get to see their might early, and reap the harvest of huge returns. Big names matter but only up to a point. Punch line seems to be...

If you want to deliver huge financial returns to your loyal investors, then deliver a hugely useful product.

Do u have one?

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.


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global stocks

J.K. Dadoo

The author is a retired IAS officer

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