Investing has its ups and downs. And in 2015, it’s tempting to start fretting about stretched valuations and the weight of economic slowdowns in both China and Europe.
But in the long run, it’s undeniable that the markets do steadily move higher -- in fact, significantly higher.
In 2004, Warren Buffett famously said that investors should expect 6% to 7% returns annually -- and for most multiyear time frames after World War II, that adds up. Consider that from the period of 1950 to 2009, the S&P 500 offered a total return of about 7% adjusted for both dividends and inflation. And data from NYU’s Stern School of Business shows that a simple average of each year’s performance for the S&P 500 from 1965 to 2014 adds up to 7.1%.
While there may be day-to-day gyrations, investors in stocks for the very long haul always come out ahead.
So as a test, if you’re in it for the very long term … what would have happened if you invested in the original 12 components of the Dow Jones Industrial Average, which was formulated back in 1896?
Related at InvestorPlace: The Top 10 Dow Dividend Stocks for June
Surprisingly, the vast majority of these companies are still around in some form -- some are even running under the same (or only slightly different) name! A few of them are actually still decent investments in their current form.
While performance is hard to track over a century of mergers and acquisitions, a look at where the original Dow Jones stocks have been (thanks to the Museum of American Finance for some of the detective work) and where they’re going can tech investors a lot about long-term strategy and the winding road that some companies follow.
So here’s a look at the original Dow components, and where they are now:
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