Becoming a millionaire from investing takes patience. Even Warren Buffett earned 95% of his wealth during his retirement age. If you want to convert $10,000 into $1 million in 10 years, you have to invest in growth stocks. And some of them have to be risky, high-volatility stocks.
Converting $10,000 into $1 million in 10 years: What are the odds?
If you do the compounded annual growth rate (CAGR) math, a 22% CAGR on a $10,000 investment today can make you a millionaire in 24 years. But if you want to become one in 10 years, you need stocks that can give you 52% CAGR. That kind of return is difficult to predict and sustain over the long term. Only stock market bubbles can generate such a return in a decade. Even Nvidia (NASDAQ: NVDA) stock converted $10,000 into $266,000 in a decade.
Only Hive Digital Technologies (TSXV:HIVE) and other crypto-mining firms managed to convert $10,000 into $1 million, and that too during the crypto bubble of 2017 and 2021 as a $0.15 share surged to around $19 during the bubble. And $19 is not the peak but a bubble burst warning. Hive stock surged past $27 during the bubble but could not sustain that price.
How you can play these odds and invest with a goal of $1 million
The market is unpredictable, as it is influenced by investor sentiments. In such an unpredictable market, an assured strategy is to invest in all possible stocks which can peak in a bubble and wait for the market to take the stock to that inflection point. You could consider the below three stocks for your ambitious goals.
Nvidia stock
Nvidia has ample growth opportunities as it has just begun the artificial intelligence (AI) journey. Its graphics processing units (GPUs) are reshaping the way we do things. The digital AI age will make machines capable of driving cars and managing traffic, surveillance cameras, diagnostics, and more. Nvidia has only unlocked the data center graphic card usage. It is now looking to tap into AI-enabled machines for edge devices.
If you stay invested, Nvidia could at least grow your money five to six times in a decade. However, there is a risk of Nvidia losing market share to a competitor. While there is always a risk, Nvidia is a leader in graphic computing, and its performance is unbeatable in AI at present. You could expect the autonomous vehicle and embedded market to be the next inflection point driving future growth.
Hive stock
Hive is closely related to Nvidia as a supplier. It uses Nvidia’s graphics card in its data centre and rents GPU computing power to other companies. The blockchain company earns income by mining Bitcoin and verifying transactions on the blockchain. It is diversifying its source of income by monetizing its GPU-enabled data centres for high-performance computing and other blockchain applications. This segment is fast growing and could provide stability to Hive’s earnings, which are largely dependent on Bitcoin prices.
While Hive can give you decent growth in the long term, a crypto bubble could help you get the kind of return that can convert $10,000 into $1 million. When that bubble comes, and your money reaches this level, it is best to exit the stock, as bubbles don’t last long.
Ballard Power Systems
Ballard Power Systems (TSX: BLDP) is a stock you can bet on with the hope that its hydrogen fuel cell technology will pick up. The company is getting orders from commercial vehicles as they move towards greener alternatives. While electric cars have picked up momentum, they are not a feasible option for commercial vehicles like trucks, buses, forklifts, and marine, where the usage is high and the distance is long.
The company has been working on this technology for decades and has made it commercially viable. It is now working on reducing the cost of manufacturing hydrogen fuel cells and refilling them. If this technology becomes widespread, BLDP could make you a millionaire.
