What if You Invested 1000$ in Bitcoin, Amazon, or Tesla in 2010?

You would have earned 114 million dollars!

We all have this particular friend, relative or work colleague, who keep telling us the same story over and over again. It is the story of how he (or she) missed out on the best investment ever. He had the chance to invest in something as it was worth peanuts but didn’t, and now he regrets it.

The first rule of investment is: do not put all your assets in one pot, diversification is critical. Therefore, we will ignore this person for a while now.

If you are interested in investment and you have watched a couple of Youtube videos or read a couple of articles then you know this, you should start investing now.

As a university student, I did not think about investments. Every time my dad told me to start saving and to invest my money, I would answer him: “I’m still young, I’ll start investing later.”

I started my investment journey in 2016, and it is going well so far. However, sometimes I ask myself, what if?

What if I bought 1000$ worth of Bitcoins 10 years ago?

What if I bought 1000$ worth of Amazon 10 years ago?

Would my life be any different if I invested 5000$ instead of spending them on nonsense?

This is precisely what I want to discuss in this post. My intention is not to “rub it in,” but rather, I want to demonstrate why investing is important and why you should start as early as possible.

114 million US dollars

Bitcoin launched in 2009. Therefore, investing 1000$ in Bitcoins (BTC) in 2010 would have been considered very risky. Now in 2020, any financial expert will tell you do not allocate more than 5%-10% of your net worth in cryptocurrencies. In 2010 people would have laughed at you.

Buying BTC in 2010 was very hard and tricky. There were only limited ways and platforms to buy and to exchange BTC. In 2010 a programmer bought two pizzas from Papa John’s. This purchase is widely believed to be the very first purchase ever with BTC (we will come back to this purchase later).

In July 2010, BTC price skyrocketed 900% within five days. The value of one BTC went from 0.008$ to 0.08$. Let us assume I bought 1000$ worth of BTC at 0.08$. This is 12,500.00 BTCs.

12,500.00 BTC is worth 114,782,500.00$ as of writing this story on July 20th, 2020.

BTC reached its highest price in December 2017. The peak price was 19,783$. At that point, the 12,500.00 BTC was valued at 247,287,500.00$.

Remember the two Papa John’s pizzas from before. The programmer paid 10,000.00 BTC for two pizzas worth about 30$ on May 22nd, 2010. Let us agree. Those are the most expensive pizzas in recorded history.

What if you invested 1000$ in Tesla ten years ago?

The average Telsa stock price in 2010 was 23.3$. With 1000$, you would have roughly 24 shares. At the moment, Tesla stock is priced at 1638 $, which means the 24 from 2010 are now worth 39,312.00$. This means that the return of investment after ten years is 3831%.

Caution: The current Tesla price is parabolic. in January 2020, the stock was valued at ca. 450$. At this price, the 24 shares would be valued at 10,800.00$, which means a return of investment of 980%. Still not a bad.

Keep in mind Tesla’s IPO launched in 2010. Nobody knew back then that every YouTuber will buy a Tesla by 2020. Elon Musk is also a very unpredictable CEO. Personally, even if I were investing in 2010, I would not have purchased any Telsa stocks.

What if you invested 1000$ in Amazon ten years ago?

Again, in 2010 Amazon was not as it is today. There was no Amazon Prime streaming service, Amazon web services were not as huge, and there was no Alexa. In early 2010 one amazon share was trading at 134$. Today, one stock is trading at 3185$.

1000$ invested in amazon in 2010 are now worth 23,769$. This is a whopping return of investment of 2277%.

What if you invested 1000$ in gold ten years ago?

A lot of people consider gold as a safe investment. Ten years ago, the average gold price was 1,226.66$. In 2020 the average gold price so far is 1,660.42$. This means that 1000$ in 2010 is now worth 1354$.

Gold is a rather safe investment. It holds its value in the time of crisis, but its return of investment is rather low when compared with other stocks.

However, gold is usually part of every investment portfolio, so it belongs here as well.

What if you diversified your investment in 2010?

As I mentioned before, every financial advisor will tell you to diversify your portfolio. So, let us assume that we diversified the investment portfolio in 2010.

Today’s expert will tell you to allocate 5%-10% of your investments in cryptocurrencies. The rest will be divided equally between Amazon, Tesla, Ford, gold, and ishares core S&P 500 ETF.

As can be seen in the table above, the majority of the value development comes from BTC. Without BTC, the return of investment (ROI) is 1873%. 1000$ allocated in the above assets without BTC would be 18,730.00$ (dividends not considered).

What is my take from this?

I do not want to promote FOMO (Fear of missing out). I want to encourage a healthy idea of investment. Not all shares will end up being profitable; not all of them will be as good as Amazon or Tesla.

With the table above, I was able to demonstrate to you how my life would have been different if I invested in the assets mentioned in this story.

WAO is an engineer and project manager located in Germany. He writes about finance, investments, self-development, and Arab related issues. To learn more about WAO, visit the following link.