Recent times have seen many investors become wealthy in a short time by making excellent high-growth stock picks in their portfolios at the right time. However, some of the wealthiest stock market investors did not accrue substantial wealth overnight. If you are an investor looking to build long-standing and compounding wealth, you should consider a long-term investment strategy.
Use your money with care
Suppose that you come into a significant amount of cash today and you are wondering what to do with it. If you spend that money on a big-ticket item you wanted to buy, you might think you got a good deal. If you invested that same money into an asset that could grow your wealth, the same money could be worth a lot more a decade or two down the line.
Provided you can find the right long-term assets, savings that you invest rather than spend right now can offer you compound growth to offer you returns that you might never have imagined.
The real key to enjoying substantial returns from your investments is to remain invested in the long run. Patience is a virtue, especially when it comes to stock market investing. Finding the right companies, investing money, and remaining invested despite any temptations to take out your capital can let you grow your wealth substantially over the long run.
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A top stock to consider
Brookfield Asset Management (TSX:BAM.A)(NYSE:BAM) is an ideal stock for Canadian investors considering long-term assets that they can buy and hold for wealth growth. Brookfield Asset Management is technically a financial stock, but the company is so much more than that.
The company is one of the largest alternative asset managers worldwide. BAM owns, manages, and operates well over $600 billion in assets from the real estate sector to infrastructure and insurance across various sectors. Its substantial diversification gives you exposure to several types of assets spread worldwide.
Investing in a diverse portfolio of assets is an ideal way to protect your capital from market volatility. Brookfield Asset Management offers you that in the form of a publicly-traded company. With interest rates persisting at all-time lows, institutional investors still prefer alternatives to bonds.
Brookfield’s assets under management (AUM) continue to rise. It would not be a surprise to eventually see its AUM cross the $1 trillion mark within the next decade.
The company is posting strong results this year as it grew its funds from operations per unit by a staggering 227% to $1.80 per share. The business has an excellent balance sheet, and it boasts a team of top-tier capital allocators.
Brookfield Asset Management has all the right qualities to consider if you are a Canadian investor seeking long-term wealth growth through a reliable investment.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Brookfield Asset Management. The Motley Fool recommends Brookfield Asset Management Inc. CL.A LV.