Editor’s note: This article was first published in October 2014, and its figures are from that date: 12-month gains of Intel 47%, Microsoft 35% and Apple 43% (September 2013 to October 2014), and Lenovo’s roughly 50% gain since February 2014.
Who would have thought it? A year ago, in September 2013, several friends and readers happened to ask me where they could invest. Ideally they wanted solid stocks with good dividends: shares that might not post spectacular gains, but wouldn’t cause much worry either.
After analysing several companies “looking ahead”, we finally recommended Microsoft, Intel and Apple. At the prices they were trading at back then, and with the profits they were consistently reporting, they looked like a good choice for investors with a conservative profile, even though they were, in a way, tech stocks.
I really did expect gains, especially from Apple, but (to be honest) I didn’t expect the other two to climb so much in just 12 months.
To our surprise, over these 12 months Intel has gained 47%, Microsoft 35% and Apple 43%. On top of all that you have to add the dividends, and the peace of mind, the good night’s sleep we sometimes don’t get with other stocks, where we hope for higher returns but take on more risk and volatility.
It’s true that we hold others with higher returns, but they carry a “somewhat risky” label, such as Lenovo, a stock I added to the portfolio in February this year and which is now up around 50%.
But in the end, choosing large-cap stocks with solid earnings and an acceptable P/E ratio, after some kind of correction, is still one of the best choices when it comes to building an investment strategy.
Further reading
- Dollar-cost averaging: an investment strategy for when you fear a market drop
- Tips for making money in a bear market
- 5 books every investor should read this summer
Featured image: Sixflashphoto, CC BY-SA 4.0, via Wikimedia Commons.
