Microsoft and Apple

Microsoft and Apple: The Unbelievable Returns

Microsoft and Apple continue to impress me every single year. There are no other stocks that have dominated for so long together, and accumulated such an impressive market cap. These two companies account for nearly three trillion dollars in market cap. Two of the largest components in three enormous indices already. I wanted to take a look back at the two and gaze in awe at their dominance.

First, we are going to go back to a time when these were both public at the same time, which was April 1986. Microsoft was the latter of the two that went public, and were immediately hit by the Black Monday pullback of September 1987. During that time, holding a portfolio of Microsoft and Apple, you would have seen a loss of 37.12%, before recovering.

The next crisis to hit was the Asian crisis of July 1997, the portfolio takes a 24.43% hit, meanwhile at the point right prior to this crash, if you were to have invested 100,000 back in April of 1986, you would have had $2.4M in your account.

The next big hit was the DotCom crash of March 2000. Microsoft and Apple lost a combined 69% of their market cap during the crisis. To put into perspective how high stocks were trading in April of 2000, the balanced portfolio of just Microsoft and Apple would have been worth $12M. Up from $2.4M just three years prior.

The next pullback would be the Subprime Crisis. This would hit Microsoft and Apple to the tune of 53% at its worst. However, right before this downturn, the portfolio would have seen a run up of more than $30M.

Now, the greatest strides for the two were about to be reached. Coming out of the Great Recession, at the lowest point, together that original $100,000 portfolio would be a “measly” $14.1M at the lowest point of 2009. Fast forward to January 2020, and that $14.1M has ballooned into an absolutely staggering $314M. A return from the depths to the tune of 2,240%. Had you had the fortitude to sit through the massive swings Microsoft and Apple put you through, you would have earned every penny of that $314M.

Leave a Reply