The weekly digest — 29.01.25

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 become entitled to our next dividend from ExxonMobil next month. In 1882, ExxonMobil began as a regional marketer of kerosene in the US. Fast-forward 140+ years, the business has evolved into one of the foremost publicly traded petroleum and petrochemical enterprises in the world, operating in most countries via its recognisable brands, including Exxon, Esso and Mobil. ExxonMobil’s endurance is underpinned by its near-17 billion of oil-equivalent barrels of proven oil reserves, versus its daily production of 3.7 million oil-equivalent barrels. Its industry-leading profitability stems from its near-$40 oil price breakeven point. That low breakeven, coupled with a growing suite of higher-margin, higher-growth adjacencies — including advanced lubricants and plastics — has enabled ExxonMobil to outperform its supermajor peers over the last three, five and 10 years in both profitability and performance. Now, the company is aggressively pursuing a near-future target of reducing its breakeven even further towards $35 — accelerating ExxonMobil’s future profitability and propelling its extension of its 42-year record of continuous annual dividend increases.

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.