The Thing About Trends | MarketFoolery - 09/17/2014 | The Motley Fool

TL;DR

A study by Fidelity revealed that the best performing investment accounts were those owned by individuals who had either forgotten about their accounts or had passed away. CNBC's audience hit a 21-year low in August, indicating a decline in interest in trading and a shift towards long-term investing. Trends in industries like smoking can be misleading, as companies like Philip Morris (now Altria) have performed exceptionally well despite declining smoking rates.

Transcript

it's wednesday september 17th welcome to market foolery i'm chris hill joining me in studio today the one and only morgan housel thanks for being here man thanks for having me it's been a while it has been a while you shouldn't take that personally i'm glad to be back uh there's a bunch of stuff i want to talk to you about we will also dip into the... Read More

Key Insights

• 🙃 Investment accounts that performed the best were those owned by individuals who forgot about or had passed away, highlighting the detrimental effects of excessive trading and portfolio turnover.
• 🍉 CNBC's declining audience reflects a shift towards long-term investing and a decline in interest in short-term trading.
• 😮 Trends in industries like smoking can be misleading, as factors like rising prices can offset declining consumption.
• 🍉 Boring or disliked companies, like tobacco stocks, can actually be great long-term investments due to their sustainability and undervaluation.
• 🥇 Roosevelt Island, a memorial to Teddy Roosevelt, is a hidden gem in Washington, DC, and a great place to visit.
• 🇻🇳 The Lincoln Memorial, Vietnam War Memorial, and the surrounding monuments in Washington, DC, offer powerful historical experiences.
• 📈 Trends in the economy and stock market are complex and cannot be simplified to one variable or sentence.

Questions & Answers

Q: What did Fidelity's study on their internal accounts reveal?

Fidelity found that the best-performing accounts were owned by individuals who had either forgotten about their accounts or had passed away. These accounts had no trading or portfolio turnover and just let their investments grow over time.

Q: Why did CNBC's audience hit a 21-year low in August?

The decline in CNBC's audience can be attributed to a shift towards long-term investing and a lack of interest in short-term trading. Investors are more focused on business models, long-term trends, and business stories rather than short-term trades.

Q: How has Philip Morris performed despite declining smoking rates?

Philip Morris, now known as Altria, has performed exceptionally well over the years, even as smoking rates decline. The company's stock has been cheap and pays out a good dividend, attracting long-term investors. Additionally, the surge in smoking prices has offset the decline in smoking rates.

Q: How do trends in industries like smoking impact investments?

Trends in industries like smoking can be misleading, as factors like rising prices can offset declining consumption. Investors should consider multiple variables and not make investment decisions solely based on one trend.

Summary & Key Takeaways

• Fidelity conducted a study on their internal accounts and found that the best-performing accounts were those owned by individuals who had either forgotten about their accounts or had passed away.

• CNBC's audience hit a 21-year low in August, reflecting a shift towards long-term investing and a decline in interest in short-term trading.

• Trends in industries like smoking can be misleading, as companies like Philip Morris have performed well despite declining smoking rates.