I’m a 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 three shares that are listed below:
The Altium Limited (ASX: ALU) share price has been one of the best performers on the ASX over the last decade. During this time the printed circuit board design software platform provider’s shares have provided an average total return of 58.3% per annum thanks to the Internet of Things boom. This would have turned a $20,000 into a staggering ~$2 million today. Interestingly, it hasn’t been an easy ride for long-term shareholders. If you had invested 10 years ago, you would have been nursing a decline of 50% a year later. It certainly has paid to patient with this one.
If you had invested in ARB Corporation Limited (ASX: ARB) shares 10 years ago you would have generated market-beating returns. Thanks to increasing demand for its 4×4 accessories across the globe, the company has grown its top and bottom lines at a strong rate over this time. This has led to its shares providing an average total return of 16.6% per annum, turning a $20,000 investment into ~$93,000.
The continued success of its CSL Behring business and the emergence of its Seqirus influenza business has led to the CSL Limited (ASX: CSL) share price generating a total average return of 23.3% per annum for this biotherapeutics company’s shareholders. This would have turned a $20,000 investment into a sizeable ~$162,400. Thanks to its positive long-term outlook, I believe it is capable of further strong gains over the next decade. As a result, I continue to believe CSL is the best blue chip share on the Australian share market.
There are not many shares that have or will provide returns like Altium has. But if you’re looking for market-beating returns over the next decade then these hot stocks would be a great place to start.
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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 Altium and CSL Ltd. The Motley Fool Australia has recommended ARB 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.