Hendrik Bessembinder’s latest paper asks the question – which US stock has generated the highest long-term returns?[i] The answer is Altria Group (formerly known as Philip Morris). Over 98 years the tobacco company produced a cumulative return of 265,000,000 percent!
Based on this it would be easy to write about how lucrative it can be to sell addictive products, particularly when there are negative externalities involved, but there is something more important for investors to take away from the research – the power of compounding over the passage of time.
More here – Behavioural Investment.
