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:
Domino’s Pizza Enterprises Ltd (ASX: DMP)
This pizza chain operator has been a fantastic place to invest over the last decade. During this time the company has delivered consistently strong sales and earnings growth thanks to the popularity of its offering and its growing footprint. In respect to the latter, back in FY 2011 the company had 866 stores. Whereas last month it released its FY 2021 results and revealed that it opened 285 new stores during the year, bringing its total to 2,949 stores. Pleasingly, management believes it can grow this to 6,650 stores in existing markets by 2033. Over the last 10 years, the company’s shares have generated an average total return of 37.2% per annum. This would have turned a $20,000 investment into ~$473,000.
REA Group Limited (ASX: REA)
The REA Group share price has also been a very strong performer over the last 10 years. This has been driven by strong earnings growth that has been underpinned by the structural shift to online property listings, the dominance of its realestate.com.au website, and its growing international operations. This has ultimately led to the company’s shares providing investors with an average 29.3% per annum total return. This means that a $20,000 investment in REA Group’s shares in 2011 would now be worth ~$261,000.
ResMed Inc. (ASX: RMD)
Finally, the ResMed share price has beaten the market by some distance over the last decade. This has been driven by its consistently solid sales and earnings growth over the period. ResMed’s growth reflects its industry-leading solutions and the growing awareness and prevalence of sleep disorders. Over the last 10 years, ResMed’s shares have provided investors with an average total return of 30.3% per annum. This means that an investment of $20,000 into its shares in 2011 would have grown to be worth ~$282,000 this year.