In 2025, furry monsters known as Labubu Dolls had a moment. The dolls were the subject of at least six articles in the Financial Times, as well as stories in The Times, on the BBC website, and The Economist. Not to mention, you may well have spotted the creatures themselves dangling from purses and backpacks.
The accessory wasn’t for everyone, but even the people that didn’t like them, were aware of them. Investors decided to jump on the craze not by purchasing a furry friend, but by investing in their owner, PopMart. Throughout August, the stock shot up nearly 38%. Now, PopMart shares have now fallen more than 33% on a 12-month view, as the Labubu trend loses steam.
What Labubus did demonstrate is the power of knowing a brand. And brands with more staying power than the furry toys can be a big attraction for investors.
The power of brands
We are drawn to the brand names we know in the supermarket, even when a cheaper option is sitting next to it on the shelf, because we know its quality, and feel familiar with it. The same philosophy comes into play for many investors: stocks in a company which makes or offers something you know, either through your own use or exposure, creates a level of familiarity.
On the other side of the transaction a strong brand creates pricing power for the company which owns it. Pricing power being the ability to increase the cost of a product or service without unduly affecting demand.
The question is, does investing in the brands you know really pay off? Market research company Kantar claims that it does, backed by its annual research on the most valuable worldwide brands.
Its ‘Strong Brands’ portfolio, a theoretical group of stocks that encompasses the top brands it has identified each year, has grown its share price 53 percentage points more than the S&P 500 in the past 20 years, and 270 percentage points more than the MSCI World Index. Kantar identifies its top brands by digging through balance sheets to show which brands are contributing most to companies, and which have the most potential for future contributions.
But when picking individual stocks, it’s not so simple. While this research identifies valuable brands, investors must choose to invest in the entire company that comes with it. Of the top 10 most valuable brands Kantar listed, four belong to companies whose share price has dropped in the past year, with both Instagram and Facebook owned by Meta.
Most of these brands are likely part of your daily, if not hourly, routine. Google has become so synonymous with web searches that it is used as a verb. Tencent and Oracle may not be names that you run into as often in life, but they are almost certainly involved in the background and trusted by other major companies to help their products succeed.
The up-and-coming options
Some investors might be more interested in the fastest growing brands, with the hopes that it translates to faster share price growth. Unsurprisingly, many of the fastest-growing brands can be found in the tech space, including ChatGPT, YouTube, Intel and VMWare (which is owned by Broadcom).
Besides Intel, these may be more difficult to access. ChatGPT is not listed, and YouTube is owned by Google. Intel has climbed 475% in the past year, reflecting its up-and-coming status. However, assessing if the entire company is appealing to you, even if the brand within it seems to be a star, will be essential.
Sticking close to home
You might notice that none of the names mentioned so far are based primarily in the UK. The US is heavily featured in this list, just as it is when it comes to global indices. But AJ Bell investors still have a penchant for the home market, with nine of the top 10 most-bought stocks this year listed in the United Kingdom.
However, there is just one UK brand that Kantar lists in its top 100 most valuable, with HSBC coming in at 89.
Still, sticking with the home market wouldn’t have been such a bad decision for UK investors in the past year, and some of the most recognisable names on this list, such as Rolls-Royce, have delivered bumper returns.
One thing worth considering is that many well-known and valuable brands are likely part of your portfolio in some form, particularly if you own a global tracker. Seven of the most valuable brands that were listed above are represented in the MSCI World’s top 10.
Hannah Williford: Investment Writer
Hannah joined AJ Bell in 2025 as an investment writer. She was previously a journalist at Portfolio Adviser Magazine, reporting on multi-asset, fixed income and equity funds, as well as macroeconomic impacts and regulatory changes...
