I’m a massive fan of buy and hold investing and continue believe it is the best way for investors to grow their wealth.
To demonstrate how successful it can be, every so often I like to pick out a number of popular ASX shares to see how much a single $20,000 investment 10 years ago would be worth today.
This time around I have picked out the three ASX shares that are listed below:
CSL Limited (ASX: CSL)
Over the last decade CSL has become one of the largest biotech companies in the world. This has been driven by its high level of investment in research and development, which has created a portfolio of lifesaving and highly profitable therapies. This portfolio has underpinned consistently strong earnings and sales growth over the last 10 years, which has ultimately led to its shares generating an average total return of 24.7% per annum. This would have turned a $20,000 investment in the company’s shares into $182,000 today. The good news is that CSL still appears to have a long runway for growth thanks to its very promising development pipeline and the positive outlooks of its CSL Behring and Seqirus businesses.
Fortescue Metals Group Limited (ASX: FMG)
The Fortescue share price has been a strong performer over the last 10 years. It may not have been a smooth ride, but its shares have beaten the market over the period with an average total return of 14.55% per annum. The majority of these gains have been made over the last five years thanks to favourable iron ore prices, the material improvement in its balance sheet, and a significant reduction in its operating costs. This means that a $20,000 investment in its shares in 2010 would be worth $78,000 today.
Nanosonics Ltd (ASX: NAN)
Over the last 10 years the Nanosonics share price has been among the best performers on the market. Thanks to the strong growth in the installed base of its trophon EPR ultrasound probe disinfection system and the increasing recurring consumable revenues the product is generating, this infection control specialist’s shares have generated a total return of 28.42% per annum. This would have turned a $20,000 investment in its shares 10 years ago into just under $250,000 today. Pleasingly, with the company on the cusp of releasing several new products, I suspect this strong form could continue over the next 10 years.
But that was then, what about now? I think the five shares recommended below could be future market beaters…
We hear it over and over from investors, “I wish I had bought Altium or Afterpay when they were first recommended by The Motley Fool. I’d be sitting on a gold mine!” And it’s true.
And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!
*Extreme Opportunities returns as of June 5th 2020
More reading
- These were the worst performers on the ASX 200 last week
- 3 ASX growth shares that could be future market beaters
- Why I’m desperate to add CSL and 2 other ASX shares to my portfolio in 2020
- Is the Downer EDI share price in the buy zone?
- Where to invest for reliable dividend shares
James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. and Nanosonics Limited. The Motley Fool Australia has recommended Nanosonics Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
The post How to turn $20,000 into $250,000 in 10 years with ASX shares appeared first on Motley Fool Australia.
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