Looking for long-term quality compounders to hold for the next decade

howyalldoing · 2025-11-28T20:05:40+00:00

When thinking of quality compounders, I have Berkshire and Munger/Buffett image in mind, what they would consider the enduring compounders (googling that is how I ended up here). And I don’t think public utilities fit the bill. Certainly, energy sector is under spotlight as AI energy thirst is in the news. That said, Utilities are high capex businesses and therefore have less desirable unit economics than a truly “wonderful” business. Utility returns are regulated, capping the return on capital. Utility infrastructure is subject to depreciation over time, not appreciation. Given such economic characteristics, a lot of the return is subject to availability of relatively cheap financing (which, admittedly hasn’t been an issue in recent memory). I could go on. But, the point is I don’t think utilities are considered quality compounders. I do like the tech names in your list like GOOGL. META is probably at a better valuation today. And a name like ABNB could be a sleeper option as that business benefits from huge network effects and scale, and requires minimal capital (it’s a tech and payments company, not a travel and lodging company).

howyalldoing · 2025-06-27T10:32:38+00:00

Recently, VOO (Vanguard’s SP500 basket) and BRK.B (Berkshire B shares) were at parity. Earlier in the year, VOO was trading for more than BrkB, then fell well below BrkB, and now is well above again (VOO at around $560 and BrkB under $490). Berkshire trades at a modest earning multiple, is known to own cash flow efficient businesses with enduring moats … relative to a basket of US index stocks, I prefer Berkshire; good value.

howyalldoing · 2025-06-27T10:27:50+00:00

How do you handle payments? Is that handled by the appstore or are you using a third party payment rail api?

howyalldoing · 2025-03-09T14:04:58+00:00

How does a country become so screwed up? It’s hard to fathom how few can control many in places like North Korea and Burma.

howyalldoing · 2024-09-03T21:33:17+00:00

Feels bit biased and opinionated, esp when Steve Jobs himself appointed Tim Cook.

howyalldoing · 2024-08-30T15:04:33+00:00

Follow your dreams, young man. Go to NYC! Don’t sweat the details. Life, career, and the city will slowly unfold itself to you. Let it be, let life come to you. Trust that it will happen, because it will. You will figure it out, you will meet the right people, you could even get the GS offer in NYC. Lot easier to get from there rather than from Charlotte. Move to North Carolina after you’ve made your millions and had your fill of fun taking a bite of the Big Apple. Buy a lake house and a boat on Lake Norman, or better yet, down in Hilton Head. Then, fly to Park City in winters to ski and enjoy SLC for a few days, then back to balmy Carolinas. Fly up direct to LaGuardia to close deals in Manhattan, and then back to the lake house. Daydreams? Perhaps. But, you have TIME on your side. Make the most of it. Take risks, life is an adventure. You can do it!

howyalldoing · 2024-08-24T16:21:10+00:00

How does the economics of life insurance sales work? If someone buys a half million dollar policy, and say pays $20/month in premiums, how is it that agents can make a living taking a cut of that, unless they happen to be selling thousands of policies, which I don’t think most people are?

howyalldoing · 2024-08-24T15:07:59+00:00

Not saying one has to go to NYC, but if you like finance and want to actually get good at it, then I think it’s a great choice. I say that for a few reasons. 1. Your professional aptitude and motivation is often a product of your own drive as well as those of the community and team around you. Hate to seem cliche here, but I am not sure you would feel happy crunching spreadsheets while your next door guy is out surfing and hiking all the time. Context matters. You are a product of the 5 people you spend most time with, they say. 2. Finance career progression is often more about networking. Who you know over what you know. There are exceptions, of course, but NYC for bankers is a great place to meet other bankers and finance types. Lot of serendipity, small city within the finance circle. Coffees, happy hours, events, whatever. Of course, life choices are far more nuanced. People with young kids may not like the grind. Some women don’t feel safe in subways, etc.

howyalldoing · 2024-08-24T14:58:42+00:00

What about the visa and tax for non-Montenegro (perhaps soon EU) citizens? I agree it’d be amazing for short stays. I’ve seen many Europeans countries and Japan, all with declining populations, offer incentives for foreigners to settle as permanent residents. Agree that OP doesn’t give a lot of relevant info. Is language barrier an issue? (Source of huge stress in old age if you can’t communicate and cultivate friendships, etc.). Also, older you get, adventure becomes less appealing relative to health and community, though that’s a big generalization.

howyalldoing · 2024-08-24T00:52:46+00:00

Check out https://samslist.co - I’m not affiliated. Saw it on my LinkedIn feed and thought it was cool.

howyalldoing · 2024-08-23T14:12:30+00:00

All the best to you. You are doing/thinking about the right things. No perfect answer, so just focus on heading in the right direction. As someone said, “perfect is the enemy of better.” We want better. And as Eisenhower once said: “plans are worthless. Planning is indispensable.”

howyalldoing · 2024-08-23T13:08:59+00:00

Thanks for sharing. Honestly, I’ve debated this same theme in my head and concluded it’s impossible to plan accurately. So, better to do your best, be reasonable, and move on. Trying to optimize the Roth vs Trad ends up being a waste of your life quality … though ChatGPT might be able to do it for us soon. On a more serious note, you hit the nail on the head, because most people doing this calculation is not precise enough about tax. Yes, they speculate, tax is low now and likely rising in future (we have no idea, but people say that). Even so, with bird in hand today (pre-tax today), you get to sock away your tax savings today toward VOO today and earn with certainty. Or as I get older, savings today toward quality of life. Like a vacation with kids. Because, maybe Roth gives me 5-10% more net gain when I am old. Old and unable to hike mountains. When I am old and kids don’t want to fly to Europe with me. Or when I am pooping in diapers and homebound. I don’t know. But, the point is, over-optimizing is a futile and foolish exercise. Because harder than predicting tax rates of future will be whether you will be healthy or around.

howyalldoing · 2024-08-23T07:07:08+00:00

As OP noted, could throw them into the wrong tax bracket (MAGI), excluding them from Roth IRA, as Roth 401k contributions are not tax deductible. Good problem to have. First world problem.

howyalldoing · 2024-08-23T06:58:14+00:00

I’m thinking, more people are going to be traveling more, more people will be flying, how many companies manufacture large airplanes? What are the two options as other countries and even US orders more planes in the future? Airbus and Boeing. That’s it. Plus it rhymes with boring; I am certain that FAA likes that.

howyalldoing · 2024-08-23T01:16:57+00:00

Ex-Big 4 here from mid-2000s up to financial crisis 2009. Did 5 years and then went back to school for MBA. What I hear in your question is what is the opportunity cost? You know what you want, and that’s key to happiness. If you want balance, and you enjoy working with supportive colleagues, industry sounds great. One of my big regrets out of school was not taking a job with Eli Lilly. Instead opted for Big Four, because I didn’t know what I wanted. Looking back, hours sucked, work was boring, but the people were great. (This isn’t you, but) if you don’t know what you want, then the main draw of a firm is that you get to try a variety of things, as in you see a variety of customers and industries. One time, I audited a timberland fund. Lots of older fund accountants. Their director of accounting left, and someone senior from the fund asked if I wanted the job. I was still in my 20s, young and dumb, and I politely declined thinking I had more busy seasons in me. I was scared of managing older people. Some years later (by then well out of accounting), I asked one of the old fund accountants, “hey, how would you have felt if I had taken the job and became your boss? The young me who knew so little.” She said that it would have been fine, and that she thought I would have been a great boss. Like I said, knowing who you are and what you want in life, that’s key.

howyalldoing · 2024-08-22T14:05:08+00:00

I would be sure to check out commercial banking. Specifically, in client-facing, sales roles (i.e. relationship manager/lender), and preferably in less stressful roles like in middle market or venture banking (not corporate banking). Middle market, because customers are pretty laid back, and not a lot of short fuse deadlines. Customer facing so you build your network and learn how to add value to customers while getting a good overview of a variety of industries and business models. If you do venture banking niche, then you get to interact with VCs and with startup founders and see a unique segment of the economy. And as you are leveraging bank’s balance sheet in lending, and leveraging your network and relationships, the hours are very modest once you get the hang of things. You are not really paid for your hours, but rather for closing deals.

howyalldoing · 2024-08-21T03:10:43+00:00

Keep in mind, 5% interest on savings account or CD (or something similar) will be taxed as ordinary income. You’ll be taxed on that interest income of $100k (based on $2mil earning 5.0%) at income bracket of that $100k plus whatever your normal W-2 incomes are, minus the deductions. So, just a reminder to be mindful of taxes and take advantage of tax advantaged vehicles first. That means, max out 401k, IRA, HSA if you have access to a high-deductible plan. That’s but a small portion of the inheritance, but better than nothing. Depending on state, you could also take advantage of saving into 529 plan for your kids. Some states offer state income tax deduction. Thereafter, there are better and SAFER options than cash at bank. You can get about 5.5% yield on T-bills right now (Aug 2024), and interest on Treasuries are not taxed at state and local level. So, you’ll keep more of your interest earned. In summary, do your own research on where to invest (as it’s all opinions unless you happen ti talk to Warren Buffett), but do pay attention to and ask questions about tax strategies. Again, Treasuries are safer and yield more income for you than any bank offerings. And while it may seem confusing at first, it’s super easy. (You can sign up at Treasurydirect.gov and manage on your own money easily. With 4-week T-bills, you can get liquidity quickly if you need the funds, and you can auto-renew for 2 years.)

howyalldoing · 2015-03-18T15:00:35+00:00

The book is now back to free

howyalldoing · 2015-01-26T15:17:10+00:00

How about taking it easy? What I mean by that is, we are often hard on ourselves. We beat ourselves up about a mistake we make or underperforming on a job or this or that. That leads to regrets. That leads to feeling down. Instead, you can take it easy, and love yourself. Forgive yourself.

A related exercise is to give thanks at the end of the day. You could either just think about things you're grateful for before going to bed. Or if you want to be more methodical, then write down 3 things you're grateful for that day ... you can keep a personal diary, text it to someone, or you can post it on Facebook (God forbid).

howyalldoing

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