Amazon.com Inc.'s (NASDAQ: AMZN) founder, Jeff Bezos reportedly carries around a piece of paper in which he lists the industries he plans on conquering next. Our American friends may know more than we do about Amazon's incredible abilities to disrupt entire sectors of the economy, but with Amazon only launching in Australia in December 2017, its impact here has yet to be fully felt. But we, as investors, should be looking ahead, nonetheless.
Here are three ASX shares I would buy to Amazon-proof my portfolio for the future.
Rio Tinto Limited (ASX: RIO)
The last industry I expect Amazon to be interested in is mining. So with Rio Tinto, one of the largest mining companies in Australia and the world, I am confident in a safe investment for the years ahead.
Rio Tinto has a varied portfolio of commodity interests – mainly iron ore, aluminium, gold, uranium, diamonds and coal amongst others. This provides some diversification compared to other mining companies such as Fortescue Metals Group Limited (ASX: FMG) or Newcrest Mining Limited (ASX: NCM).
Rio has just rewarded shareholders with a massive dividend payment of US$13.5 billion in 2018 (over $11 per share). With exposure to so many essential commodities, I expect Rio to continue to remain a solid and rewarding investment in the years to come.
Appen Ltd (ASX: APX)
If you can't beat 'em, join 'em.
Appen Ltd provides machine learning and artificial intelligence (AI) research and data. Appen is a highly specialised company that provides a niche service to the largest companies in the world. It is a booming industry, with Appen dealing with Microsoft, Google and yes, Amazon as regular clients. Demand for Appen's services is rising strongly, as the use of virtual assistants such as Siri and Alexa become more and more integrated into our lives. These virtual assistant services rely on being able to understand us, and Appen provides valuable data in natural language processing and automated speech recognition that makes this happen.
As Amazon continues to grow and competition heats up in the virtual assistant/AI space, Appen is poised to benefit enormously and is a stock I would feel very comfortable in owning into the future.
Rural Funds Group (ASX: RFF)
If Amazon isn't interested in mining, farmland would have to be a close second. Rural Funds Group is a REIT specialising in agricultural leases, including cattle, cotton, tree nuts and vineyards.
Farmland has been a sound investment for most of human history and demand for food, wine and clothes is a fairly reliable foundation. Rural Fund's 'tenants' include Treasury Wine Estates Ltd (ASX: TWE) and Select Harvests Limited (ASX: SHV), two of the most successful agricultural businesses in Australia.
Furthermore, Rural Funds' has used inflation-linked leases to increase its dividend in real terms every year since listing in 2014, which makes the company a great income investment as well.
Foolish takeaway
Good investors always have one eye on the horizon, and I think it would be a good idea to watch Amazon with the other. In this modern age, disruption is a constant and when investing, it always pays to look at what threats may be looming and where a company might be in ten years' time. I believe these three ASX stocks have bright futures and can co-exist with a dominant Amazon. But at the end of the day, I still don't know what is on that piece of paper in Jeff's pocket.
