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Could We Make an Entire "War on Cash" Index?

By Motley Fool Staff – Updated Apr 16, 2019 at 10:09AM

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Maybe the war-on-cash basket doesn't really do the magnitude of this trend justice.

One of our Industry Focus: Financials listeners recently asked if more stocks could potentially be added to our "war on cash" basket -- that is, those stocks that stand to benefit most from the trend toward a cashless society.

In this clip, host Jason Moser and Fool.com contributor Matt Frankel, CFP, discuss some of their favorite candidates, including American Express (AXP -1.94%), Green Dot (GDOT -1.88%), Apple (AAPL -1.51%), Amazon (AMZN -3.01%), and even Berkshire Hathaway (BRK.A -0.22%) (BRK.B -0.28%), just to name a few. Our war-on-cash basket is starting to look more like an entire stock index!

A full transcript follows the video.

Check out the latest Apple, Amazon, American Express, and Green Dot earnings call transcripts.

This video was recorded on Feb. 4, 2019.

Jason Moser: @Every90Midwest said, "Hey, you mentioned you could put four more in your war on cash basket. Care to share what those would be? Are Discovery and American Express two of them?" Matt, I'm going to give you first up here. If you could add any stock or stocks to the war on cash basket, what would you throw in there that's not currently in there?

Matt Frankel: I like American Express because they do a really good job of spanning the entire spectrum, especially the lower-end consumers. I've referred to Green Dot, it's one of my favorites that I'm about to talk about. They've done a great job of the prepaid debit card market, being really inclusive to the underbanked, which is what they call people without bank accounts and things like that. American Express has been a pioneer of solutions for that segment of the market. I would definitely put Amex in there.

Green Dot is one I talk about all the time. They're not only focusing on their own products, but on helping other companies offer cashless products to customers. To name a couple more, I'd actually put Apple in the war-on cash basket. Apple Pay is getting bigger and bigger. Amazon's another one, they're the ultimate cashless business.

Moser: That's a good point.

Frankel: I would argue that you can put more than four in the war on cash basket.

Moser: We could probably have our own fund. We could build an ETF with all these ideas. I like all those names you said. I would lean toward American Express over Discovery. Discovery is not a bad business, I just don't know that it has the same brand power that American Express has and the optionality to build out new offerings and whatnot. I also was thinking about this, Berkshire Hathaway. You could throw that in there as a lower-risk play, but they recently made some big investments in to the cashless movement. That's a way you could participate.

Perhaps for a little global exposure, Latin America in particular, MercadoLibre might be one worth looking at. They have their own payments solution there, Mercado Pago. Could be a little bit of a higher risk profile, maybe, but definitely gives you exposure to that.

A lot of different options out there for investing in that cashless movement. Nice problem to have, I suppose.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Jason Moser owns shares of Amazon and Apple. Matthew Frankel, CFP owns shares of American Express, Apple, and Berkshire Hathaway (B shares). The Motley Fool owns shares of and recommends Amazon, Apple, Berkshire Hathaway (B shares), Discovery (C shares), and MercadoLibre. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Apple Inc. Stock Quote
Apple Inc.
AAPL
$150.43 (-1.51%) $-2.31
Amazon.com, Inc. Stock Quote
Amazon.com, Inc.
AMZN
$113.78 (-3.01%) $-3.53
American Express Company Stock Quote
American Express Company
AXP
$140.26 (-1.94%) $-2.77
Green Dot Corporation Stock Quote
Green Dot Corporation
GDOT
$18.75 (-1.88%) $0.36
Berkshire Hathaway Inc. Stock Quote
Berkshire Hathaway Inc.
BRK.A
$404,485.25 (-0.22%) $-889.76
Berkshire Hathaway Inc. Stock Quote
Berkshire Hathaway Inc.
BRK.B
$267.77 (-0.28%) $0.74

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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