You’ve heard it a ton: keep a long-term focus. That’s hard to do when markets start to gyrate. Many people are consistent savers when stocks rise, but when they’re headed lower, panic sets in.
There are a few tricks to help you maintain a long-term focus. The best option is to find stocks you want to own for decades to come.
Finding a multi-decade winner isn’t easy. They are few and far between. But once you find a company worth sticking with, the best choice is to keep adding to your position, through good times and bad.
There’s one TSX stock in particular that I think could keep rising for another century! It already has a proven track record, but the most exciting aspect is its durable business model.
This is too easy
Warren Buffett says he’s likes to invest in stocks that are like shooting fish in a barrel with all the water drained out. There are few opportunities this easy, but some come close.
For example, what if you could bet on rising populations? You could have made a fortune. In 1900, the world’s population was just 1.6 billion. It has grown every decade since, surpassing six billion in 2000. Today, the global population is approaching eight billion.
The party won’t end anytime soon. The United Nations believes populations will continue to rise until 2100, when the globe will host more than 11 billion humans.
This is a great opportunity in theory, but are there stocks that let you bet on population growth? Not exactly, but if you find companies that benefit from population growth, you can get pretty close.
Which companies benefit from population growth? Those would be businesses that own assets that rise in value as more people are born. That includes energy, telecom, and transportation businesses. More people translates to more demand for these services.
Trust this TSX stock
The best stock I’ve run across that directly benefits from population growth is Brookfield Infrastructure (TSX:BIP.UN)(NYSE:BIP). One look at its asset base will tell you why.
Brookfield recently spent $150 million on a U.K. telecom business, $600 million on cell towers in India, and $425 million on a U.S. LNG facility.
Perhaps the most attractive part of this stock is its resilience to economic shocks. During the pandemic correction of 2020, the value of Brookfield’s assets was virtually undisturbed. That’s because many of its segments are structured specifically to avoid volatility.
For example, cash flows in its telecom segment are underpinned by inflation-linked, volume-agnostic contracts with an average term of 15 years. No matter where the economy heads, Brookfield will secure its cut of the profits.
As management likes to reiterate, “Strong downside protection does not limit upside potential of our business.” Over the last decade, Brookfield stock has risen four times in value, all while paying a dividend of around 3%.
With the global population expected to rise for another century, this is a company you can permanently rely on. You can continue to pile capital into this stock at any point, knowing that the long-term future remains very bright.