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How to turn $20k into $2 million in 10 years with ASX shares

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 may be down 28% from its 52-week high, but it has still smashed the market over the last decade. Thanks to increasing demand for its Altium Designer software due to the Internet of Things boom, Altium has been growing its profits at an explosive rate over the period. This has led to its shares generating an average total return of 61.1% per annum since 2010. Which means that if you were lucky enough to invest $20,000 in its shares 10 years ago, your investment would now be worth ~$2.3 million.

Another market beater over the last 10 years has been the Premier Investments Limited (ASX: PMV) share price. Thanks largely to the successful expansion of its Smiggle brand internationally and the strong growth of the Peter Alexander brand, the retail conglomerate has delivered an average total return of just over 10.2% per annum. This would have turned an investment of $20,000 in the company’s shares into almost $53,000.

Due to the proliferation of sleep apnoea globally, ResMed Inc. (ASX: RMD) has experienced very strong demand for its sleep treatment products over the last decade. This has led to the medical device company growing its top and bottom lines at a very strong rate over the period. Unsurprisingly, this has resulted in its shares generated market beating returns for investors. Over the 10 years, ResMed’s shares have recorded an average total return of 22.8% per annum. This would have turned a $20,000 investment into $160,000 today.

5 stocks under $5

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

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Premier Investments Limited. The Motley Fool Australia owns shares of Altium. The Motley Fool Australia has recommended ResMed Inc. 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.

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