5 Criterias on What Stocks to Buy & Hold

James Altucher has an Ultimate Cheat Sheet for Investing where, among other things, he writes about what Warren Buffett thinks about stocks to hold. He writes, “It seems to me he has five criteria:

  1. A company will be around 20 years from now.
  2. At some point, company’s management has demonstrated in some way that they are honest, good people. If you can get to know management even better.
  3. The company’s stock has crashed for some reason (think American Express in early 60s, which he loaded up on. Or Washington Post in the early 70s. Or Coca-Cola in the early 80s).
  4. The company’s name is a strong brand: American Express, Coke, Disney, etc.
  5. Demographics play a strong role.

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