I’m a very big fan of buy and hold investing and believe it is one of the best ways 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 ten years ago would be worth today.
This time around I have picked out the four shares that are listed below:
The ResMed Inc. (ASX: RMD) share price has been an impressive performer over the last decade thanks to the medical device company’s innovative products and increasing global demand for sleep treatment services. Over this time ResMed’s shares have generated an average total return of 21.95% per annum. This means that anyone that invested $20,000 into the company’s shares 10 years ago would have seen their investment grow in value to $145,500 today.
Due to the development of highly sought after pokie machines, strong market share gains, and the recent emergence of its fast-growing digital business, Aristocrat Leisure Limited (ASX: ALL) shares have been a great place to invest your money over the last decade. Over this time the gaming technology company’s shares have provided an average total return of 23.3% per annum, which would have turned a $20,000 investment into $162,500.
The SEEK Limited (ASX: SEK) share price has charged notably higher over the last 10 years. This has been driven by the strong profit growth it has achieved thanks to the shift to online job listings from print media, the company’s leadership position in the industry, and its expansion into international markets. Over the period the company’s shares have generated an average total return of 19.3% per annum. This means a $20,000 investment would have grown to be worth $116,800 over the period.
Finally, the TPG Telecom Ltd (ASX: TPM) share price may be down almost a third from its 52-week high, but it has still provided an incredible return for shareholders over the last decade. Thanks to its development from a telco challenger to an industry leader, TPG Telecom’s shares have generated an average total return of 32.2% per annum. This would have turned a $20,000 investment into a whopping $325,000 in just 10 years.
But that was then, which shares will deliver returns like these over the next 10 years? My money would be on these high quality and buy-rated ASX shares.
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Motley Fool contributor James Mickleboro owns shares of SEEK Limited. The Motley Fool Australia has recommended ResMed Inc. and SEEK 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.