Earning 10% Yields Off A 5% Stock

Plenty of articles discuss buy-and-hold investing. However, very few authors ever provide real world, personal examples of their long-term investments.

This creates two problems.

The first? Newer investors feel like they’ve missed all the best, most obvious opportunities. “If you’d bought one share of Coca-Cola when it IPO’d and held it forever, your $64 investment would be worth $600,000.” A fun fact, but not particularly helpful.

The second issue? Purely academic discussions on long-term investing make it hard for newer investors to realize just how fast “the miracle of compound interest” actually works.

So, here’s a real example of a stock that I bought five years ago and have held ever since.

This is not a high-growth investment. Nor is it a particularly exciting stock. Yet, buying and holding doubled my money. And, “the miracle of compound interest” has grown my dividend income to a 10% annual yield on cost.

Put another way, every year, I’m collecting 10% of my initial investment in cold, hard cash.

What is this company?

AbbVie Inc. ($ABBV). AbbVie is a pharmaceutical giant that makes two of the 10 best-selling drugs in the world. The stock is a spin-off from Abbott Laboratories ($ABT), and AbbVie has…