I’m a big fan of buy and hold investing and believe it is the best way for investors to grow their wealth.
To demonstrate how successful it can be, 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:
ARB Corporation Limited (ASX: ARB)
This 4×4 accessories manufacturer has been a bit of a quiet achiever over the last decade. Without much fanfare, ARB has grown its sales, earnings, and dividend at a consistently solid rate over this time. This has been supported by the growing popularity of 4×4 vehicles and increasing demand for its products internationally. This positive form has led to the ARB share price providing investors with an average total return of 16% per annum since 2010. Which would have turned a $20,000 investment into just over $88,000 today.
Carsales.Com Ltd (ASX: CAR)
The Carsales share price has been a market beater over the last decade. This has been driven by its consistently solid sales and earnings growth over the 2010s, which has been underpinned by the seismic shift to online auto listings. Also supporting its growth has been its global expansion. Carsales now has a presence in both South America and Asia. Overall, this has led to its shares generating an average total return of 17.15% per annum. This means that a $20,000 investment in its shares would now be worth just under $100,000.
Magellan Financial Group Ltd (ASX: MFG)
Thanks to its expert stock picking and popular global investment funds, this fund manager has experienced a tidal wave of fund inflows over the last decade. For example, in August 2010 the company had funds under management of approximately $1.3 billion across its global equities and infrastructure equities. At the end of October, this had grown to $103.5 billion. Unsurprisingly these stunning fund inflows have been reflected in the performance of the Magellan share price. As a result, its shares have generated an average total return of 47.2% per annum over the last decade. This would have turned a $20,000 investment into a massive $955,000.
Where to invest $1,000 right now
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of June 30th
More reading
- These were the worst performing ASX 200 shares last week
- Why the Magellan (ASX:MFG) share price dipped lower today
- Top brokers name 3 ASX shares to sell today
- ASX stock of the day: Platinum (ASX:PTM) shares up 6%
- 3 ASX shares with large dividend yields
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended ARB Limited and carsales.com Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
The post How to turn $20,000 into $950,000 in 10 years with ASX shares appeared first on The Motley Fool Australia.
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