Five stocks every midlifer should buy and hold forever

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AstraZeneca

The best healthcare companies benefit from consistently growing customer demand and allow investors to own a stake in cutting-edge technologies.

Simon Gibson, of wealth manager Mattioli Woods, said: “Healthcare stocks benefit from ageing populations and have the potential to develop hugely significant innovations in medical technology. They are also good ‘defensive’ investments, as people and businesses spend money on healthcare no matter what is happening in the economy, so their shares can perform well even during recessions.”

He said the best way foe investors to own healthcare companies was to buy the Polar Capital Healthcare Opportunities fund, which owns 48 companies ranging from pharmaceutical giants to specialist medical device firms and biotechnology stocks. 

The fund’s largest holding is AstraZeneca. In 2019, it grew sales by 12pc, while sales of new medicines rose 50pc. This innovative streak is balanced with steady revenues from patented drugs, helping to pay its dividends to shareholders. The shares currently yield 2.3pc.

Microsoft 

Like Alphabet, Microsoft is established as a global technology leader and offers good prospects of strong share price gains.

The $2.3 trillion company’s computing software provides stable income but Microsoft is also a leading innovator in cloud computing, computing devices, gaming and artificial intelligence. All are areas that are growing in importance as we spend more of our lives online. 

The shares trade on a p/e ratio of 38, but revenues are expected to grow at a double-digit rate well into the future, making it a good investment over 10 to 15 years, according to Stephen Yiu, of investment manager Blue Whale Capital.

He said: “Microsoft is that rare breed of business which combines a stable and resilient income, via its Windows and Office365 software, with cutting-edge growth in its cloud computing business. This winning combination has enabled it to deliver resilient profits throughout the pandemic while also growing its dividend.”

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