You live a charmed life. You wake up excited about your commute to work, because you will be listening to that audio book that you've been looking forward to. Work is work, but that online connection helps you tap into that cool walkthrough to get you out of the video game that had you stumped the night before. You then come home to find a new DVD rental in your mailbox. Your DVR records your favorite show as you stream the new tracks of a band you just heard about, buying the digital downloads if they float your boat.
This may not be you, but it's a reasonable composite of what you could be. It wouldn't even run you all that much. An Audible
To fuel your leisure time at home, a TiVo
The point of this virtual shopping spree
Today's technology has created new ways to free up more of your time and enhanced the ways you can spend those greater chunks of free time. Better yet, you can pad your portfolio by investing in the companies that are making it possible.
I'm not the first to advocate buying the companies behind your favorite products. Peter Lynch made a killing as manager of the Fidelity Magellan mutual fund by doing just that. He parlayed his skill into a lucrative early retirement as an award-winning author of common-sense investing gems like One Up on Wall Street and Beating the Street. Some of his best stock ideas came from simply taking his wife and kids to the mall and gauging which specialty retailers were winning them over.
That strategy continues to pay off today. Netflix went public just four years ago, but it's gone on to sign up nearly 5 million subscribers. There's a fair chance that you're one of those members, or know more than a few people who get giddy when they see red rectangular envelopes in the mailbox. Got the credit card statement that had your first Netflix payment on it? Remember the day when you were first intrigued by the model? Good. Pull up a split-adjusted quote for Netflix on that day, then realize how much money you left on the table by not snapping up Netflix shares the day you gave up making a run to the corner video store forever.
One a year ago? Netflix shares have risen 70% in that time. Three years ago? Brace yourself: Netflix has soared nearly 120% higher since then. So it goes.
The benefits of familiarity
If you're fanatical about certain products or services, think back to when they became an indispensable part of what defines you. Pull up a historical quote -- which may sadly become a hysterical quote -- to see how much better your portfolio would be performing if your head listened to your heart.
I go through that kind of self-discovery every month as I write my Early Adopter Roundup column for readers of the Motley Fool Rule Breakers newsletter service. The premium research publication ferrets out disruptive technologies, recommending two new stock ideas every month that are reshaping their sometimes-sleepy industries. CNET is a company that was originally singled out last year.
Where will the next double in your portfolio come from? If my aim is true, it may be just a few feet away from you, making your life a little better -- and silently pleading to make your stock performance a little better, too. If you don't believe me, come join the growing Rule Breakers community and see for yourself, courtesy of a free trial subscription.
This article was originally published on May 19, 2006. It has been updated.
Longtime Fool contributor Rick Munarriz has been writing the Early Adopter Roundup column since the newsletter's inception in the fall of 2004. He does own shares in Netflix. TiVo and Netflix are Stock Advisor recommendations.TheFool has a disclosure policy.
