Author Topic: Is this the worlds best investment ever? Over 7000x return  (Read 1685 times)

bwall

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Is this the worlds best investment ever? Over 7000x return
« on: April 08, 2021, 02:59:41 PM »
Here's some data points on perhaps the greatest investment the world has seen. If you know of a better investment, please share!

In 2001 a 90 year old newspaper and media company in South Africa invested $32 million USD for a 45% stake in an unknown Chinese company.

The South African company, Naspers, had a market cap of around $180m at the time. They'd just gone public in 1994. This chart only goes back to 2003 and it lists the market cap at $180 million, so I'll use that number. If someone has more accurate info, please share!

https://companiesmarketcap.com/naspers/marketcap/

This means that Nasper's invested over 17% of it's entire market cap and perhaps all of it's available cash (?) for a minority stake of a company in China that might go broke, as happens often with startups, or have management abscond with the money as happens from time to time. Naspers entire management had neither Chinese speakers nor even Asians. They were wading into very unknown waters. Perhaps their only edge was their history of doing business in Africa, a region known for it's political and economic instability.

Today, Nasper's stare of that company, Tencent, is worth around $220 billion. They've just cashed out of some stock for the second time, netting around $15 billion. The first cash-out was for just under $10 billion in 2018.

https://edition.cnn.com/2021/04/08/investing/tencent-prosus-naspers-stock-sale-intl-hnk/index.html

So, this means that Naspers got over 7000x return in less than 20 years. A 7000x returns means that $1000 invested would be worth $7m; $100 invested would be worth $700,000.

It's hard to compare and I know that 'best' is subjective, but does anyone know of better investment returns over a similar time span?

lutorm

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #1 on: April 16, 2021, 10:39:53 PM »
I know people who have stocks that have gone up 750x over past 15 years, which I thought was pretty good... 7000x is crazy, unless maybe if you're an angel investor.

forgerator

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #2 on: April 18, 2021, 02:46:17 PM »
This is too easy. Back in 2010 Bitcoin was worth pennies (roughly 5 to 10c) compared to around $60k now. That is a return of over 1,000,000x in over 11 years.
And in fact there were some cryptos back in 2017 that had insane runups like XVG (Verge) which went up 8000x in less than a year.

bwall

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #3 on: April 19, 2021, 08:51:18 AM »
This is too easy. Back in 2010 Bitcoin was worth pennies (roughly 5 to 10c) compared to around $60k now. That is a return of over 1,000,000x in over 11 years.
And in fact there were some cryptos back in 2017 that had insane runups like XVG (Verge) which went up 8000x in less than a year.

Who are the HODLers who got those returns?

Can you name a person (or entity) that captured all that value and got 7000x returns?

yachi

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #4 on: April 20, 2021, 08:50:18 AM »
Here's some data points on perhaps the greatest investment the world has seen. If you know of a better investment, please share!

In 2001 a 90 year old newspaper and media company in South Africa invested $32 million USD for a 45% stake in an unknown Chinese company.

The South African company, Naspers, had a market cap of around $180m at the time. They'd just gone public in 1994. This chart only goes back to 2003 and it lists the market cap at $180 million, so I'll use that number. If someone has more accurate info, please share!

https://companiesmarketcap.com/naspers/marketcap/

This means that Nasper's invested over 17% of it's entire market cap and perhaps all of it's available cash (?) for a minority stake of a company in China that might go broke, as happens often with startups, or have management abscond with the money as happens from time to time. Naspers entire management had neither Chinese speakers nor even Asians. They were wading into very unknown waters. Perhaps their only edge was their history of doing business in Africa, a region known for it's political and economic instability.

Today, Nasper's stare of that company, Tencent, is worth around $220 billion. They've just cashed out of some stock for the second time, netting around $15 billion. The first cash-out was for just under $10 billion in 2018.

https://edition.cnn.com/2021/04/08/investing/tencent-prosus-naspers-stock-sale-intl-hnk/index.html

So, this means that Naspers got over 7000x return in less than 20 years. A 7000x returns means that $1000 invested would be worth $7m; $100 invested would be worth $700,000.

It's hard to compare and I know that 'best' is subjective, but does anyone know of better investment returns over a similar time span?
$20 turned into 235 million

I'm serious.  An investment with little expectation of a reasonable return does not turn into "the world's best investment ever" because it made lots of money, just as a lottery ticket did not turn out the be the best investment ever because it won.  You should know enough about a company to determine whether it's a good investment when you put the money into it, and at that point it stops being an "unknown company" at least to you.  If you think this company could go broke, you should weigh the probability of it happening, and discount it from the price you're willing to pay.  If you don't trust management to rip you off, you should probably stay away.

Roland of Gilead

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #5 on: April 20, 2021, 09:48:23 AM »
This is too easy. Back in 2010 Bitcoin was worth pennies (roughly 5 to 10c) compared to around $60k now. That is a return of over 1,000,000x in over 11 years.
And in fact there were some cryptos back in 2017 that had insane runups like XVG (Verge) which went up 8000x in less than a year.

Who are the HODLers who got those returns?

Can you name a person (or entity) that captured all that value and got 7000x returns?


Too easy.  Gloria MacKenzie invested $2 in POWERBALL and ended up with $590.5 million.

That is a 295,000,000x return

BicycleB

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #6 on: April 20, 2021, 03:41:43 PM »
This is too easy. Back in 2010 Bitcoin was worth pennies (roughly 5 to 10c) compared to around $60k now. That is a return of over 1,000,000x in over 11 years.
And in fact there were some cryptos back in 2017 that had insane runups like XVG (Verge) which went up 8000x in less than a year.

Who are the HODLers who got those returns?

Can you name a person (or entity) that captured all that value and got 7000x returns?

Curious. How would one be able to name an investor in something that's specifically designed to be anonymous?

I've read articles implying that the Winklevoss twins bought Bitcoin early, and at some points had claimed to have gained at least hundreds of millions of dollars thereby; I think there was a stage years ago where they claimed a net worth of $1.4 billion consisting mostly of BTC. 2014 or 2016 or so, maybe? But they periodically seek publicity I think, and seem to have added a series of businesses to whatever coin portfolio they have. Perhaps they sold their BTC along the way; unclear. https://nypost.com/2021/04/05/winklevoss-twins-slam-facebook-as-their-crypto-business-booms/

PS. I will admit that in the early days, I would assume that only a few Bitcoin had been mined, therefore the number of people receiving 7000x+ gains on a substantial dollar basis should be small, even if they held the whole way through. Also curious what % of coinholders from 2011 still possess their coins today.
« Last Edit: April 20, 2021, 05:02:42 PM by BicycleB »


bwall

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #8 on: April 22, 2021, 08:33:14 AM »
This is too easy. Back in 2010 Bitcoin was worth pennies (roughly 5 to 10c) compared to around $60k now. That is a return of over 1,000,000x in over 11 years.
And in fact there were some cryptos back in 2017 that had insane runups like XVG (Verge) which went up 8000x in less than a year.

Who are the HODLers who got those returns?

Can you name a person (or entity) that captured all that value and got 7000x returns?


Too easy.  Gloria MacKenzie invested $2 in POWERBALL and ended up with $590.5 million.

That is a 295,000,000x return

Hmmm...... I don't think that Powerball tickets are an investment. You're welcome to think so, but I think you'd be in the minority around here.

bwall

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #9 on: April 22, 2021, 08:40:23 AM »
I heard of 7800% in one year.

https://financialpost.com/commodities/energy/oil-gas/billionaire-russian-oligarch-igor-makarov-takes-major-stake-in-calgary-natural-gas-producer-spartan-delta

Thank you for the post & link. This is more along the lines of what I was hoping to learn about with the original post. I read the article, but I'm a bit fuzzy as to the return that the gentleman received. 7800% is like... 78x, right? Turning $1 into $78? If they do that for ten years in a row they'd have 780x returns, right?

ender

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #10 on: April 22, 2021, 08:49:19 AM »
Hmmm...... I don't think that Powerball tickets are an investment. You're welcome to think so, but I think you'd be in the minority around here.

Is your challenge basically to "name one #yolo large investment amount done by a large corporation purely through stock appreciation that went up more than 7000x?"

To be honest, this feels a bit silly to me.

They got lucky. But as you say, they got lucky.

bwall

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #11 on: April 22, 2021, 09:13:26 AM »
Hmmm...... I don't think that Powerball tickets are an investment. You're welcome to think so, but I think you'd be in the minority around here.

Is your challenge basically to "name one #yolo large investment amount done by a large corporation purely through stock appreciation that went up more than 7000x?"

To be honest, this feels a bit silly to me.

They got lucky. But as you say, they got lucky.

I was hoping to learn more about big investments that paid off big, and provided an example of such. I know that there is a lot of collective knowledge here and I was hoping to find out more examples.

I guess I find the big decisions that people make to be rather fascinating. Because, although it was a corporation in my example, decisions are still made by a person, or people in a committee of sorts.

I totally understand that not many people share my same interest, judging by the replies. And that's ok.

K-ice

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #12 on: April 22, 2021, 01:14:47 PM »
I heard of 7800% in one year.

https://financialpost.com/commodities/energy/oil-gas/billionaire-russian-oligarch-igor-makarov-takes-major-stake-in-calgary-natural-gas-producer-spartan-delta

Thank you for the post & link. This is more along the lines of what I was hoping to learn about with the original post. I read the article, but I'm a bit fuzzy as to the return that the gentleman received. 7800% is like... 78x, right? Turning $1 into $78? If they do that for ten years in a row they'd have 780x returns, right?


Yes and I think one time jumps like that are an anomaly. I don't think the company expects that year after year.  That is why some people buy single stocks and try to get lucky.  But overall I think it's important to be slow and steady with 80% of your portfolio.

Do I wish I had known about that company and invested $10,000 now $780,000 sure... but I do not know how to get in on those opportunities.

theoverlook

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #13 on: April 22, 2021, 02:25:10 PM »
Comparisons to lottery tickets are silly. Presumably the investors did their due diligence on tencent and felt they had a solid opportunity, and it paid off. Good job.

BicycleB

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #14 on: April 22, 2021, 02:38:00 PM »
I heard of 7800% in one year.

https://financialpost.com/commodities/energy/oil-gas/billionaire-russian-oligarch-igor-makarov-takes-major-stake-in-calgary-natural-gas-producer-spartan-delta

Thank you for the post & link. This is more along the lines of what I was hoping to learn about with the original post. I read the article, but I'm a bit fuzzy as to the return that the gentleman received. 7800% is like... 78x, right? Turning $1 into $78? If they do that for ten years in a row they'd have 780x returns, right?

Well, no. 7800% is 78x, yes, turning $1 into $78. But to get 780x, they just need 78x the first year followed by 10x after that; 78 x 10 = 780. (Easy peasy! I should do that myself. Lol.)

If you got 78x ten times in a row, you'd...own more than the whole stock market.

78 raised to the sixth power is over 225 billion, which if you started with a dollar, would make you the richest person in the world. At least if my Excel is multiplying correctly! (Try "=78^6" or "=78*78*78*78*78*78")


« Last Edit: April 22, 2021, 02:48:20 PM by BicycleB »

bwall

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #15 on: April 22, 2021, 02:44:55 PM »
Doh! Right you are, @BicycleB . I'm OK at math, but not great, as you can see. Thanks for the correction.

BicycleB

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #16 on: April 22, 2021, 03:50:38 PM »
We've all done it, no worries!!

My criteria for "best investment ever" are slightly different. As K-ice points out, there's a question as to how to get in on these opportunities. From the article, the stock's 78x jump emerged from some sort of bankruptcy reorg (?), something where it would be hard for an outsider to know in time, even if the stock is available for trading. Similarly, I remember reading about BTC when the first two pizzas were bought, but had 2 barriers: I was too skeptical that this new thing would grow to be of real value, and I would have needed to learn how to access it and mine or buy it, which was difficult (at least relative to "I'll buy a share Company X that trades on NYSE"). Actually I can see a case for BTC meeting the title's implied definition, but am happy to set it aside for this thread. So my criterion is, what's the best investment an ordinary Main Street investor could have bought as easily as buying a stock on a major exchange?

I have 2 well known candidates. Neither got 78x as fast as the example you gave, so your find beats them % per year, maybe it's the best under that measurement. But 78x isn't sustainable anyway so maybe a higher return over longer time is a better metric. What's the best you could do over 10 years, 20 years? Are there widely traded stocks that meet my ease of purchase criteria and exceed 78x?

Depending on timeframe:

10 years - TSLA. Available $15/share ($3 after stock splits) in July 2010 shortly after IPO. Sold between $1080 and $1795 ($216 and $359) in July 2020, so you could have done 359/3 = 119.7x in almost exactly 10 years. It's up quite a bit since then too - over 200x at current prices. To be fair, prices were usually between $4 and $6 (I mean $20 and $30 before splits) most of the first year but 120x from then to now was achievable on many start dates.
https://finance.yahoo.com/quote/TSLA/history?period1=1277769600&period2=1619049600&interval=1mo&filter=history&frequency=1mo&includeAdjustedClose=true

I remember wanting that Tesla roadster, and during that very year, buying a foolish new car. I have wished many times that I thought to buy a used car and put the other 25k into Tesla. Even if I sold half in 2020, I'd be ahead by about, well, 78x! Meaning a couple of million bucks.

20 years - Apple. Early 1997, frequently available around $17/share (.15 after stock splits that turned one share then into 112 shares now), and at least one point, about $13.50/share (.12 after splits, according to Yahoo Finance tables https://finance.yahoo.com/quote/AAPL/history?period1=345427200&period2=1619049600&interval=1mo&filter=history&frequency=1mo&includeAdjustedClose=true). By early 2017, $35 after stock splits, so roughly 228x over a 20 year period. Again has done well since then; at current price $131.94/share, up roughly 900x since early 1997.

The company had been widely traded for 16 years by the start date and performed mediocrely so the trick was knowing when to pick the flailing company right before its turnaround became evident.

ETA: Just realized that 20 years ago to today is better than the timeframe I picked if you want an exact period. Up around 300x.

At 50 years, of course the pick that's obvious in hindsight in Berkshire. Famously up 2000x or so over time. I have a little trouble understanding how one became a shareholder of Buffett's Berkshire back then, though, other than being a Friend of Warren.
« Last Edit: April 22, 2021, 08:44:14 PM by BicycleB »

K-ice

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Re: Is this the worlds best investment ever? Over 7000x return
« Reply #17 on: April 22, 2021, 08:56:59 PM »
Doh! Right you are, @BicycleB . I'm OK at math, but not great, as you can see. Thanks for the correction.

I guess I was just answering the first part 7800% = 1*78.  I'd be happy to cash out to VTI after that lol.