In 1980, had you invested a mere $1,000 in what went on to become the top-performing stock of S&P 500, then you would be sitting on a cool $1.2 million today.
Source: The Motley Fool
If you love money, this will blow your mind.
In 1980, had you invested a mere $1,000 in what went on to become the top-performing stock of S&P 500 (^GSPC 0.12%), then you would be sitting on a cool $1.2 million today.
That equates to a total return of 120,936%.
The stock? None other than Gap (GPS -0.73%).
You read that right. According to an analysis of the "entire universe of U.S. based stocks publicly traded since 1980," M&T Bank found that the multi-branded retailer scored the top spot among all of the stocks that are currently on the S&P 500.
What's perhaps more interesting is that Gap was in exceptionally good company, as four of the top five S&P 500 components on the list were all retailers.
You can see evidence in the following graphic, which charts how much a $1,000 investment in 1980 would be worth with respect to each of these stocks today.
Coming in second is L Brands (BBWI 2.47%), the retail concern behind Victoria's Secret and Bath & Body Works, among others, with a compound annual growth rate of 22.9%. Third is TJX (TJX 1.39%), the "off-price apparel and home fashions retailer" behind T.J. Maxx and Marshalls, among others, with a CAGR of 22.8%. And in fourth place is Wal-Mart (WMT 1.00%), the world's largest retailer, with a CAGR of 21.9%.
It's also worth pointing out that all of these are, to varying extents, discount retailers that were positioned perfectly to take advantage of the Great Bull Market that got under way in 1982. And all of them have since grown alongside the American consumer. Their total returns (rounded to the nearest 1,000%) come out to be 90,000%, 88,000%, and 69,000%, respectively.
The lesson here is simple. The opportunity to invest in great companies coupled with the magical power of compounding returns can make prescient and patient investors very rich.
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Mark Roussin, CPA has positions in AbbVie, Alphabet, Coca-Cola, Microsoft, Prologis, and Visa. The Motley Fool has positions in and recommends Alphabet, Chevron, Home Depot, Microsoft, NextEra Energy, Prologis, and Visa.
What was the best performing stock of 1980? ›
Hasbro (HAS) had the highest return in the 1980s by a US stock, returning 32,901.2%.
| ASSET | DECADE | % RETURN |
|---|
| Nike (NKE) | 1980s | 24,068.18% |
| Gap (GPS) | 1980s | 10,438.71% |
| Hormel Foods (HRL) | 1980s | 10,374.75% |
| Home Depot (HD) | 1980s | 5,940.57% |
21 more rowsStock market returns since 1980
This is a return on investment of 14,212.86%, or 11.82% per year. This lump-sum investment beats inflation during this period for an inflation-adjusted return of about 3,655.16% cumulatively, or 8.51% per year.
Is Motley Fool stock Advisor better than sp500? ›
MY SUMMARY AS OF MAY 26, 2024:
The average return of all 530+ Motley Fool Stock Advisor recommendations since the launch of this service in 2002 is 703% vs the S&P500's 155%. That means they are now beating the market by OVER 4X since inception. They have a win rate of 66% profitable stock picks.
What is Motley Fool's all in buy? ›
We regularly see similar ads from the Motley Fool about “all in” buy alerts, sometimes also called “double down” or “five star” buys, and they're generally just the type of steady teaser pitch that they can send out all year, over and over with no updates, to recruit subscribers for their flagship Motley Fool Stock ...
What are Motley Fool's double down stocks? ›
The Motley Fool advises holding onto winning stocks, as they often continue to outperform in the long run. "Double down buy alerts" from The Motley Fool signal strong confidence in a stock, urging investors to increase their holdings.
What has outperformed the S&P 500? ›
However, one income gem has managed to outperform the S&P 500 over the past 10 years. This gem is Waste Management Inc (NYSE:WM), a North American waste management company with a market cap of $83.38 billion USD.
What is the best performing stock of all time? ›
The Best Performing Stocks in History
- Coca-Cola. (NASDAQ: KO) ...
- Altria. (NASDAQ: MO) ...
- Amazon.com. (NASDAQ: AMZN) ...
- Celgene. (NASDAQ: CELG) ...
- Apple. (NASDAQ: AAPL) ...
- Alphabet. (NASDAQ:GOOG) ...
- Gilead Sciences. (NASDAQ: GILD) ...
- Microsoft. (NASDAQ: MSFT)
Nike (NKE) had the highest return between 1985 and 2023 by a US stock in the S&P 500 (GSPC), returning 4,310,396%.
How much is $10,000 invested in the S&P 500 in 1980? ›
Craziest thing I learned recently: $10,000 invested in the S&P 500 in 1980 would be worth over $1M today.
Choosing your investments
Investing in an S&P 500 fund can instantly diversify your portfolio and is generally considered less risky. S&P 500 index funds or ETFs will track the performance of the S&P 500, which means when the S&P 500 does well, your investment will, too. (The opposite is also true, of course.)
What is the 20 year return of the S&P 500? ›
Average returns
| Period | Average annualised return | Total return |
|---|
| Last year | 26.2% | 26.2% |
| Last 5 years | 16.4% | 114.0% |
| Last 10 years | 15.3% | 314.1% |
| Last 20 years | 10.8% | 684.6% |
The Motley Fool has positions in and recommends Apple, Berkshire Hathaway, and Goldman Sachs Group.
Which is better Zacks or Motley Fool? ›
Zacks is better if you want quantitative analysis and short-term trading ideas. Motley Fool is preferable for fundamental analysis and long-term investing approach.
Is Motley Fool or Morningstar better? ›
If you're looking for stock picks, choose The Motley Fool. I cover its flagship service in detail in this Motley Fool Stock Advisor Review. If you're looking for objective analysis and ratings on ETFs and mutual funds, choose Morningstar.
What are the 10 best stocks to buy right now? ›
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| Company (ticker) | Analysts' consensus recommendation score | Analysts' consensus recommendation |
|---|
| Nvidia (NVDA) | 1.31 | Strong Buy |
| Amazon.com (AMZN) | 1.32 | Strong Buy |
| Emerson Electric (EMR) | 1.32 | Strong Buy |
| Microsoft (MSFT) | 1.33 | Strong Buy |
19 more rowsSee the 10 stocks »
Keithen Drury has positions in Alphabet, Meta Platforms, and Taiwan Semiconductor Manufacturing. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Apple, Meta Platforms, Nvidia, and Taiwan Semiconductor Manufacturing.
Which stock will boom in 2024? ›
5 best stocks to buy
| S.No. | Top 5 Stocks | Industry/Sector |
|---|
| 1. | Shriram Finance | NBFC |
| 2. | SBI Life Insurance | Insurance |
| 3. | Axis Bank | Banking |
| 4. | Mahindra & Mahindra | Auto |
1 more row6 days ago
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