Your $1m inheritance is locked for 10 years in one company, which one ?

If there wasn't the reference to 'company" I would ignore the fact this is is in the NZ forum and go with the ETF VTI - the Vanguard ETF for the total US market.

As it does say company I would still ignore the NZ forum part and go with BRK-A. Despite their not keeping up with the S&P500 in the last ten years of the current bull market I think they will show their mettle when the tide turns.

If it has to be a NZX listed company I would still cheat by going for BIT - Bankers Investment Trust PLC - which I currently hold on the LSE. My money being held by people knowing far more about investing than I ever will with them doing their best for me sounds ideal.

But I would sulk big time about the FIF regime for all of the above. Interestingly, despite these comments, I still have 50% of my share market investments in NZ.

Company I would go RYM just because of how secure it is even though its so damn expensive right now. I see the levers in the industry being turned up in the next 10 years in favor of them.

If you said stock I would have said FNZ. I would take a safe return more than speculating if that is my inheritance.

Good thread Beagle, to promote discussion, opinions, ideas.No one answer is best or right or wrong. 10 years locked in is a long time so risk is by far the biggest priority for me personally.

I think I would go for the retirement sector, as has been said many times, there will be more older people over the next while and out of my picks of RYM, SUM or OCA, would go for SUM- More runs on the board than OCA, not quite as many as RYM and therefore in my opinion a better growth prospect. RYM may start to flatten out sooner than SUM imho.

IN saying all that I have some funds in OCA only at present, no it is not $1M or anything close to 6 figures even and it is not for 10 years, well not at this stage in any event, I can always sell if need be, where as with this theoretical pick you can't.
Or I will tell you next week after I pick up $10M from lotto of where I have actually invested it:)

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Originally Posted by Beagle

I was brushing up on a little bit of Buffet today and thought I'd play a little theoretical exercise this weekend. I have my answer already but will post that on Monday.


Congratulations, you just inherited one million dollars and there are just two conditions. Its to be held in trust for you and all dividends received reinvested and you can't touch it for 10 years. You can only choose one company to invest the full amount into. Which company do you choose and why ?

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Never expected to inherit anything from great great uncle Rudolf Percy,so it comes as a big surprise.Certainly don't need it,having prospered under my own steam,so even in ten years time it will make no difference to our lifestyle, or way of life,so might just as well have some fun with it.
PAZ on NZ Unlisted market is company that could be worth 20 to 50 times the under 10 cents it is trading at currently,in 10 years time.
They are an innovative developer,manufacturer and marketer of science based,natural nutritional products.
www.waitakibio.com

PS.Another company, like A2, started by the late Howard Paterson.
Disc My wife and I hold.

heehee, great little promo you've snuck in there percy:mellow:

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Originally Posted by Joshuatree

heehee, great little promo you've snuck in there percy:mellow:

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Read well .........................................
Could not help myself..!......lol.

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Originally Posted by percy

Never expected to inherit anything from great great uncle Percy,so it comes as a big surprise.Certainly don't need it,having prospered under my own steam,so even in ten years time it will make no difference to our lifestyle, or way of life,so might just as well have some fun with it.
PAZ on NZ Unlisted market is company that could be worth 20 to 50 times the under 10 cents it is trading at currently,in 10 years time.
They are an innovative developer,manufacturer and marketer of science based,natural nutritional products.
www.waitakibio.com

PS.Another company, like A2, started by the late Howard Paterson.
Disc My wife and I hold.

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What's an inheritance.....LOL

My $1m would all go on OCA.
Forecast yields are 2018 3.8%, 2019 4.36% 2020 5.07%.
At those rates over 10 years I would expect a total yield of 87%
Would expect SP to be at least $3.30 in 10 years (based on 6% yield) so total return of approx. $4m+

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Originally Posted by winner69

Seeing RYM is leading the way in this discussion you might be interested in how the share price has performed over time

Table shows multi year returns from different starting years (June)

Over 10 years great returns but sometimes you have to put up with some not so good periods.

One thing table highlights is that there are certain times when returns are below average (like being “richly priced”) ....and vice versa

Maybe, just maybe, now is one of those ‘richly priced’ times ....who knows ...but even if so 10 year returns should be OK if you last the time.

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With respect because I know you know this, but ex-dividend share price analysis is imho not an accurate representation of investment 'returns'.

A buy and hold strategy over 10 years must take into account accumulated dividends, then it gets complicated (i.e. assumptions are required) as to whether the dividends are re-invested in the head-share or elsewhere and what the tax paid is and ergo overall return over the 10-years is.

In the scenario Beagle has laid out, I'm not a fan of RYM as 'the single investment' over 10years, I think its commercial model could be vulnerable to regulation in the future (like in Australia). A good company in a portfolio, but not imo the best if limited to one choice.

I'd pick an utterly boring company in an entrenched industry that consistently makes obscene profits .. ah ha, that'd be a bank, so lets say ANZ is my pick.

:)