At least, it is if you’re Warren E. Buffet. And in his case, it’s household names. The multibillionaire has a string of stock investments that resembles a local soccer mom’s grocery cart: Fruit of the Loom, Johnson and Johnson, Kraft Foods. He recently sunk 6.5 billion into the Mars-Wrigley chocolate and gum merger, and oh, did we mention he owns Dairy Queen?
Warren’s buffet of all-you-can-eat, All-American names in a good example of a particular kind of approach to stock investment, based on the theory that, as prices go up, brand recognition and loyalty to familiar names will be the deciding factor that makes Mom grab you out from a lineup of ten different breakfast cereal options.
Money managers generally agree with this approach, and advise to pick brand names that are #1 or 2 in their market.

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