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:
Goodman Group (ASX: GMG)
This integrated commercial and industrial property group owns, develops, and manages industrial real estate in 17 countries. It has been a very strong performer over the last decade thanks to its focus on investing in and developing high quality industrial properties in strategic locations. These are close to large urban populations and in and around major gateway cities globally, where demand is strong and transformational changes are driving significant opportunities. This has underpinned strong earnings and distribution growth, leading to its shares generating a total average return of 19.4% per annum since this time in 2011. This would have turned a $20,000 investment into ~$120,000.
NEXTDC Ltd (ASX: NXT)
NEXTDC is Australia's leading data centre operator. Thanks to the shift to the cloud, a significant increase in demand for capacity in data centres, and its growing network of centres, NEXTDC's sales and earnings have been growing at a strong rate for a decade. This has led to its shares smashing the market over the last 10 years. During this time, the NEXTDC share price has provided investors with an average total return of 21.8% per annum. This would have turned a $20,000 investment into ~$145,000 in 2021.
REA Group Limited (ASX: REA)
Another company that has been growing very strongly thanks to a structural shift has been REA Group. With property listings moving from newspapers to online, its realestate.com.au website has benefited greatly over the last decade. Especially given its dominance of the industry. This has been supported by the growth of its complementary businesses and its international operations. All in all, this has led to REA Group share price generating a total average return of 28.6% per annum for shareholders since 2021. This means that a $20,000 investment in REA Group's shares in 2011 would now be worth ~$250,000.
