An interesting idea for your portfolio? Holdings.

By investing in holdings, you invest in multiple companies at the same time.

On top of that, they have proven they can outperform the market.

What are Holdings?

Holding companies are different from regular companies.

They don’t make goods or provide services, they own pieces of other companies.

Holding companies make money in 2 ways:

• The appreciation in value of the companies they own

• Dividends

The most important thing for a holding company isn’t running the business.

It’s making great capital allocation decisions (choosing which companies to invest in).

Why are Holding Companies Interesting?

Holding companies usually trade at a discount.

This means you can buy them at a cheaper price than what they are actually worth.

Brookfield Corporation is a great example.

The holding is active in different segments:

To understand Brookfield, you have to understand each one of these businesses.

That takes a lot of time and effort.

But it also creates opportunities.

Investors often ignore these companies, causing them to trade at discounts.

Brookfield Corporation currently trades at a price of $42.
Their intrinsic value? $68.

This means Brookfield Corporation trades at a 38% discount.

This is a large discount from an historical perspective.

On top of that, their track record is amazing.

Brookfield has compounded at an impressive 16.6% per year since 2001.
They outperformed the S&P 500 by a wide margin.

You can read more about Brookfield Corporation here.

🏆13 Interesting Holding Companies

Now let’s dive into 13 holding companies you should know.