Let's Talk... The Future of Investing in Your Favorite Companies

Earlier this week, I posed a question on X.

“What big company today do you think will not exist in 25 years?”

It gained 115k views and 334 comments.

People’s answers were all over the board: Google, Boeing, Uber, Meta, Intel, GameStop, etc.

But the truth is, every company will fail at some point.

Just look at Sears.

Once the world's largest retailer now operates less than two dozen stores.

Look at Blockbuster.

At its peak in 2004, it brought in around $5 billion dollars and had around 9,000 stores. Now, it only has one store left

Heck, even Jeff Bezos has been predicting Amazon's 'inevitable death' for years.

It may not be today. It may not be tomorrow. But your favorite company will inevitably go out of business.

As an investor, that’s not very reassuring, is it?

No, it’s not…

But there’s no reason to worry if you’re an index fund investor.

You see, according to data from the S&P Dow Jones Indices, nearly 180 stocks in the S&P 500 (more than a third of the index) have been replaced since 2015.

That’s roughly 20 changes a year.

That means every year, 20 poor-performing companies get swapped for better companies.

So you never have to worry about one single company going out of business. If that happens, the company will be replaced with another. And there are still 499 other companies keeping the index afloat.

Another reason why I love investing in index funds.

So, what big company today do you think will not exist in 25 years?

Darrell