BOSTON ( TheStreet) -- The next time you head into the kitchen for a snack you may also be able to satisfy your appetite for quality investments.
A common bit of advice is that you should invest in what you know, and food is something we all know well. Are there benefits to a "refrigerator portfolio," choosing investments based on the brands you and your family buy?
|A common bit of advice is that you should invest in what you know, and food is something we all know well.|
Open the fridge and take a peek. Are there Heinz (HNZ), Coca-Cola (KO - Get Report) or Pepsi (PEP - Get Report) bottles? Hormel (HRL - Get Report) meats (Spam anyone?) or Tyson (TSN - Get Report) chicken strips, perhaps?
Are there Hershey (HSY - Get Report) bars chilling in the freezer or cereal boxes from Kellogg (K - Get Report) and General Mills (GIS - Get Report) stocked beside it? Is there a box of Arm & Hammer baking soda (made by Church & Dwight (CHD - Get Report)) wedged in the back, alongside a can of Kraft's (KFT) Maxwell House coffee and some Sara Lee (SLE) pound cake or Jimmy Dean sausages?Did you stock up on all those goodies at Safeway (SWY - Get Report), Kroger (KR - Get Report), Whole Foods (WFM - Get Report), Wal-Mart (WMT - Get Report) or Target (TGT - Get Report)? If you assume -- probably correctly -- your neighbors buy similar products, these refrigerator stocks could beef up your portfolio and keep your retirement plan well-fed. Mitch Schlesinger, CFA, managing director of FBB Capital Partners in Bethesda, Md., says now might prove a great time to get a taste for food company stocks. "It makes some sense, especially in volatile markets, because those companies tend to have stable recurring cash flows, which gives them business stability," he says. "We used to think of them as recession-proof. Maybe that's not quite accurate, but they do tend to be repeat purchase items that people buy year in, year out, in good times and bad."