The Nifty Fifty: Forty-Three Years Later

In 1972, the Morgan Guaranty Trust (in conjunction with a few other investment advisory companies) launched an advertisement push called the “Nifty Fifty” that proclaimed certain American companies were so dominant, they should be purchased and never sold. The intuitive appeal of this argument was obvious—people will always need food, beverages, medicine, and so on—and the companies included on the list all had excellent records of making shareholders rich, with the popular terminology at the time calling them “blue-chip stocks” rather than “dividend growth stocks.”

But there was a problem with the timing of this list: many of the companies were trading at lofty valuations that have only been seen three times in … Read the rest of this article!