Holding stocks through the up and down cycles of the stock market is hard for many investors. After all, if a stock doubles or triples, people don't want to see those gains disappear. And it can be gut-wrenching to watch a stock you own seemingly drop day after day.
But having the fortitude to hold the stocks of great companies over the long term is the way to let your investments grow and generate what can be life-changing returns. Leading technology company Nvidia (NVDA -2.90%) is a case in point.
What will Nvidia stock be worth in 2025?
Before looking at where Nvidia might go from here, consider the path the stock has taken over the past five years. The company spent years developing the computing power hardware and related software needed for cutting-edge artificial intelligence (AI) applications. Now that it is monetizing that research and development, investors who held shares along the way have been rewarded handsomely.
Consider that if you had invested $2,500 in Nvidia just five years ago, those shares would now be worth $44,900. But one had to have a strong stomach to see those gains. Much of that massive return was realized over the last 18 months.
The average 78% annual return trounces the approximately 10% total annual return of the S&P 500 index over the past 95 years. But it wasn't an easy road to achieve that return. There were several periods in those five years when Nvidia shares plunged by more than 25% from the previous high. That included a massive 65% plunge that occurred during 2022.
But Nvidia's powerful computing chips and software are in high demand now. That's led to an exponential jump in revenue and earnings. No one knows where Nvidia stock will be in 2025. But long-term investors shouldn't worry about that. As long as the company continues to innovate, the stock deserves a place in any diversified portfolio.
