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 4X4 parts company has been a great place to invest over the last decade. Over the period, the company has grown its sales, earnings, and dividend at a consistently solid rate. This has been driven by strong demand for its products in domestic and export markets, which is being underpinned by the growing popularity of SUVs. This positive form has led to the ARB share price generating an average total return of 19.3% per annum since 2011. This would have turned a $20,000 investment into just over ~$117,000 today.
CSL Limited (ASX: CSL)
While the last 12 months have been underwhelming for the CSL share price, that hasn't stopped it from absolutely smashing the market over the last decade. The biotherapeutics company's shares have been charging higher since 2011 thanks to its strong sales and earnings growth. This has been driven by increasing demand for its immunoglobulins, the acquisition of the Novartis influenza vaccines business, and its high level of investment in research and development activities. The latter has ensured that CSL has a pipeline of potentially lucrative products. Over the last 10 years, CSL's shares have generated an average total return of 24.9% per annum. This would have turned a $20,000 investment into almost $185,000.
REA Group Limited (ASX: REA)
Finally, another company which has impressed over the last decade is this property listings company. REA Group has been able to grow its earnings at a strong rate over the last 10 years thanks to the structural shift to online listings and the dominance of its realestate.com.au website. This has been supported by its growing international operations. This has ultimately led to the company's shares providing investors with an impressive 30% per annum total return. This means that a $20,000 investment in REA Group's shares in 2011 would now be worth $275,000.
