The Only 100% Legitimate Way To Get 1,000% Returns

A few weeks ago, I told you about a simple strategy that's never lost money .

Put simply, the longer you hold an investment, the better your chances of making a profit. The S&P 500 has never had a losing 20-year span, going all the way back to the 1950s.

The key is finding a handful of companies that enjoy huge (and lasting) advantages over the competition... companies that pay their investors each and every year by dishing out fat dividends... and companies buying back massive amounts of their own stock.

Once you find them, the strategy is simple -- just buy their shares and hold "Forever."

But if you want to see the best reason why investing "Forever" is the smartest way to let the market make you wealthy, pay attention to the table below...

I ran a simple stock screen on my research team's Bloomberg terminal. I wanted to find all the stocks in the United States that have returned more than 500% in the past year. To make sure we were dealing with solid companies, I only included companies with positive earnings. And to weed out the fly-by-night penny stocks , I had to kick out anything with a tiny market cap under $100 million.

You can see the results for yourself.

Just 3 stocks survived the cut -- out of 6,462 traded on the New York Stock Exchange. Talk about looking for a needle in a haystack. What's more, I bet you've never even heard of these stocks... much less own any of them. I sure hadn't.

In other words, out of thousands of stocks, you probably don't have a remote chance of finding a stock that returns over 500% in one year. Much less a stock that you'd want to risk your hard-earned money on.

But there is still a way to legitimately earn returns of 500%, even 1,000% or more on your money. And it's much easier and less risky than you would ever think possible.

With this in mind, I ran the exact same screen again... only I changed the time period to the past 10 years. The results are night and day.

Over the past 10 years, 181 stocks returned more than 500% . That's almost 60 times as many as the past year. Lesson: if you can hold on for a decade, you're 60 times as likely to hit it big.

That's because the market's greatest stocks take years to reach their full potential.

They won't do it in one year... or even two or three years. But give them enough time for their business plans to bear fruit, and you will see your gains steadily compound into the sort of wealth that can change your life.

Take a well-known case -- Apple (Nasdaq: AAPL ) . Apple has been one of the market's best performers for years. But even in the stock's best one-year period, investors made 289%.

I wouldn't sneeze at a 289% gain, but anyone who bought for a year sold themselves way short.

You can see from my chart that Apple wasn't done after six months or a year...

Since 2003, Apple has gained 7,838%. That's an average annual gain of 47%... and enough to turn every $10,000 invested into more than $780,000 .

Owning a stock like Apple for a short period is like ordering a 7-course meal and only sticking around for the appetizer. Sure you get a taste... but wouldn't you rather have the whole meal?

And yet, as I told you a few weeks ago , the average holding period for a stock is now down to just seven months.

I think that's a mistake. I'm not saying you should buy and hold every investment for decades. But what I've discovered -- and wish I had realized sooner -- is that it's the few investments you simply buy and hold "Forever" that make the biggest difference to your long-term wealth.

It's one of the reasons my Top 10 Stocks staff and I started researching the best stocks we think investors can hold "Forever."

What we found was that many of the stocks we tagged as "Forever" ideas were already owned by many of the world's richest investors, politicians, and businessmen -- including Warren Buffett, George Soros, and John Kerry.

Its also no surprise that eight out of 10 of these "Forever" stocks pay a dividend -- with yields from 4.6% up to 11.1%. In my Top 10 Stocks newsletter, I rarely invest in stocks that don't pay dividends.

You can find all the details in a free presentation we've recently put together called " The 10 Best Stocks to Hold Forever ." To watch it now, visit this link .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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