If I’d put £5,000 into Lloyds shares in 2015, here’s how much it would be worth now

I was just wondering how well, or badly, I might have done if I’d invested £5,000 in Lloyds Banking Group (LSE: LLOY) shares in September 2015.

And then I remembered, I did buy some Lloyds exactly then. The trouble is, I paid 76p each for them. Had I invested £5,000, after charges I’d have bagged 6,530 shares.

Nearly nine years on, the Lloyds share price stands at 56p. And 6,530 shares are now worth only about £3,650 after selling charges. That’s a loss of 27%. Ouch.

A disaster?

So what’s the point of telling you all about this now? Is it just to put one of my worst investing disasters behind me, and move on?

Well, no.

Firstly, when I add dividends to the picture, the outcome is nowhere near as bad as it looks.

And then, I see a wider lesson about the stock market in general. And I think it’s a very encouraging one.

But dividends first, and I reckon Lloyds will have generated a total of 21p per share in that time. So that means each share would today be worth a total of 77p, a penny more than I paid back in 2015!

Oh, and I’d have done better if I reinvested my dividend cash into more shares.

I do actually do that, but I roll it into my next investment and wouldn’t have just bought more Lloyds. So I’ll leave those potential extra gains out.

Breakeven

What, on the face of it, looks like a pretty bad investment actually turns out to break even.

Now, “I invested some money, and nine years on I haven’t lost any of it,” isn’t the kind of talk that makes Warren Buffett‘s letters to Berkshire Hathaway shareholders such great reading.

But there’s a real stock market lesson for me.

I held some shares in one of the hardest hit sectors of the past 10 years, in the market’s worst decade that I can remember.

And I didn’t lose anything.

So where’s all the dangerously risky danger that so many people recoil in horror at when they hear me say I buy stocks and shares?

Long term

The truth is, yes, there is risk. But it’s those who go for the rapid ins and outs, trying to get rich quick, who face the worst of it.

I know the cash I put into Lloyds would actually have done better in a Cash ISA. But it’s my worst-performing stock of the past decade. And because I always diversify, my overall Stocks and Shares ISA looks a fair bit better.

Those of use who are patient and invest for a decade or more can greatly reduce our chances of risk-based pain.

Researchers at Barclays have examined investments over rolling periods of time. And the longer the period, the better the chance that shares will beat cash.

In fact, if we look to 20-year periods, UK shares have never lost out to cash in more than a century.

Sell my Lloyds shares? Not a chance.