Money Any patient investor can turn $5,000 a year into nearly $1 million, says billionaire Ron Baron

16:58  12 november  2017
16:58  12 november  2017 Source:   CNBC

Tesla Founder Elon Musk Lost $800 Million This Week

  Tesla Founder Elon Musk Lost $800 Million This Week The downside of owing most of your net worth to an erratically profitable company: Your paper value fluctuates. A lot. After a earnings report that did little to pique investor optimism over the Model 3, shares of Tesla fell, leading to a roughly 7% drop off since Monday. That made Elon Musk’s net worth drop by roughly $800 million over the same period. The billionaire CEO who backs Tesla and aerospace company SpaceX, who owes the majority of his net worth to his electric car company, owned a stake in Tesla worth about $10 billion as of Friday. His net worth is now nearly $19 billion thanks to his $9.6 billion stake in SpaceX, and excluding some liabilities, based on data from Bloomberg. Musk’s net worth has fluctuated by billions of dollars, as investors have increasingly bet on, or against, Tesla’s success. At one point earlier this year, the billionaire was worth nearly $23 billion thanks to optimism surrounding the Model 3. And both bulls and bears have a case. Tesla has been burning cash in a bid to produce its mass market Model 3. It has only posted two profitable quarters in its history as a company. Yet in a letter to shareholders recently, Tesla warned of Model 3 production bottlenecks. s a result, Tesla said it would reach a rate of producing 5,000 Model 3 vehicles at the start of 2018. Previously, Tesla said it would reach the rate by the end of 2018. On the other hand, bullish investors are betting on the future of electric vehicles, arguing some patience will result in a successful Model 3 production ramp, leading to steady profitability. Musk is also in a sense, better off than he was just a year ago. Over the course of the past 12 months, Tesla’s stock has risen 59%. According to the Bloomberg Billionaire Index, his net worth was about $8.2 billion back then.

That's how you get rich," said the billionaire founder of Baron Capital, which has nearly billion in assets under management. But individual investors don't need to pick stocks, he said . "The simplest thing for people to do is buy an index fund." "If you invest $ 5 , 000 a year for 30 years it's worth

That's how you get rich," said the billionaire founder of Baron Capital, which has nearly billion in assets under management. But individual investors don't need to pick stocks, he said . "The simplest thing for people to do is buy an index fund.""If you invest $ 5 , 000 a year for 30 years it's worth 0

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It's wrong for people to think that they have to be wealthy to get rich investing in the stock market, famed buy-and-hold investor Ron Baron told CNBC in a Friday interview.

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Any patient investor can turn $ 5 , 000 a year into nearly $ 1 million , says billionaire Ron Baron . CNBC. A retired Navy SEAL commander does 2 things every night before bed so he can attack the next day the minute he wakes up.

A crucial line in Trump's new tax plan will make it a lot harder to buy a $ 1 million home. Business Insider. Any patient investor can turn $ 5 , 000 a year into nearly $ 1 million , says billionaire Ron Baron .

"You have to have a small amount of money and invest it regularly for a long time, and live to get to be old. That's how you get rich," said the billionaire founder of Baron Capital, which has nearly $26 billion in assets under management. He appeared on "Squawk Box" from the sidelines of his annual investor conference in New York City.

"It's all about compounding," he said, referring to the power of making regular investments and reinvesting the returns over decades.

Baron has made billions of dollars by doing extensive research, buying the stocks of what he feels are undervalued companies, and keeping them for an average of about 14 years. But individual investors don't need to pick stocks, he said. "The simplest thing for people to do is buy an index fund."

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Any patient investor can turn $ 5 , 000 a year into nearly $ 1 million , says billionaire Ron Baron . CNBC. Mysterious 'green line of death' appears on some iPhone X displays.

Any patient investor can turn $ 5 , 000 a year into nearly $ 1 million , says billionaire Ron Baron . CNBC. It proposes a new limit — 0,000 from the current $ 1 million — for home-mortgage-interest deductions.

"If you invest $5,000 a year for 30 years ... it's worth $890,000" based on historical stock market returns, he calculated.

Ron Baron, Chairman & CEO of Baron Capital. © Provided by CNBC Ron Baron, Chairman & CEO of Baron Capital.

On a shorter time horizon, he said that a decade using that strategy would yield $110,000. "If you do it for 20 years, it's worth $250,000."

Baron bases his belief in the power of long-term investing on the historical correlation between the economy and the stock market.

"The economy grows with the market," he said, though admitting that at any given time one may be ahead of the other or visa versa. "We're thinking the economy growth is going to accelerate, pointing to low interest rates, cheaper oil prices, and disruptive technologies. "That means that the stock market growth should accelerate," he reasoned.

Over the summer, Baron said he could see the Dow Jones industrial average at 40,000 by the year 2030. On Friday, he told CNBC, "That may be a little low." The Dow closed Thursday at 23,461, less than 1 percent off the recent all-time highs.

To make his case, Baron pointed to a recent prediction from fellow value investor and billionaire Warren Buffett. Last month, Buffett said the Dow should be over 1,000,000 in 100 years. "But that's just compounding 4 or 5 percent a year," Baron said, which is a rate on par with his estimates.

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