The weekly digest — 19.02.25

A Winning Machine

What is more powerful than a 101-year-old winning machine? Since 1923, the S&P500 index has generated an annualised return of ~10.5%. For more than a century, it has:

• Beaten 99.9% of professional investors, who typically underperform the index annually by ~2-3%, with the gap widening over time.

• Proven its stellar compounding potential; $1 invested in the index in 1923 would be worth more than $13,000 today.

• Comprised of the bluest of the world’s blue-chip stocks, self-regulating and re-weighting these in line with their individual performances — eliminating user selection error.

• Always regained its previous highs, surviving the Great Depression, one World War and the Covid pandemic.

Weekly Digest

On a look-through basis, we will soon become entitled to Sysco Corp’s (short for Systems and Services Company) next dividend, which will be declared next week. Sysco Corp was originally founded in 1969 as an amalgamation of nine food distribution companies with combined sales of $115 million at the time. Today, more than five decades later, Sysco is the global leader in selling, marketing and distributing food and non-food products to restaurants, healthcare, educational and lodging facilities — exceeding $78 billion in sales in 2024. On its home turf in the US, Sysco is number one in every segment it caters to, commanding an estimated share of around 17 per cent of the annual $360 billion US foodservice market. Given foodservice is a highly regulated business, characterised by high-volume, low-margin turnover, Sysco is especially privileged in the space due to its efficiency in sourcing, supply chain and logistics. Since most competitors are much smaller, it seems unlikely — if not impossible — for them to match Sysco as the scaled lowest-cost leader. Rather, Sysco expects to gradually extend its footprint and market share. While the company is less ubiquitous around the globe, its ex-US business is growing much faster and with higher profit margins, establishing a formidable base and visible runway for Sysco to extend its 55-year dividend growth record.

To Have and To Hold

The greatest threat to our investment success? Us. So, how do we get ourselves from outset to outcome? Over four years, we’ve collected more than four million data points that demonstrate how a particular methodological communication keeps investors on track. This email is part of a powerful anticipatory feedback loop that works as a bad-decision buffer. With our handholding, evidence shows investors are far more likely to hold onto their investments — long enough to enjoy their wins.