Five stocks that could have made you $178M in 5 years

Q: What's the biggest financial haul I could have scored from stocks if I was the best stock picker over the last five years?

A: Wouldn't it be great, especially as an investor, if you could know what was going to happen in the future? If you had the luck, foresight or skill to pick the best stock each year, you could score some massive gains.

How massive? How rich could you be if you hit the best stock of every year the past five years? It's a gain most likely beyond your wildest dreams.

To find out just how profitable having uncanny stock-picking abilities could be, let's put some numbers behind it. Investors can take a look at the Standard & Poor's 1500 index, which includes stocks of all sizes, and locate what the best stock in the index was each year.

Had you had the amazing luck to pick the best stock each year, your total price appreciation and winning stock each year would have been (according to Standard & Poor's Capital IQ and USA TODAY research):

• Best of 2006: CorVel (CRVL), 275.8% gain

• Best of 2007: First Solar (FSLR), 795.2% gain

• Best of 2008: Emergent BioSolutions (EBS), 416% gain

• Best of 2009: Select Comfort (SCSS), 2,508% gain

• Best of 2010: Entropic Communications (ENTR), 293.5% gain

Imagine investing $10,000 at the start of 2006 in that year's best stock, CorVel, and then moving your money each year to the following year's best stock. The value of the portfolio would have grown at the end of each year to:

• 2006: $37,580

• 2007: $336,529

• 2008: $1,736,490

• 2009: $45,287,659

• 2010: $178,206,938

Yes, you read that right. If you picked the best stock of each year, your $10,000 investment would be worth $178.2 million in just five years. That's an average annual return of 608%. Not bad.

Of course, it's easy to do this kind of analysis looking backwards. We're all stock-picking geniuses in hindsight. Yet, at the beginning of the year, it's all but impossible to predict what the best stock will be. Even investors who stumble on a great stock make subsequent mistakes by selling at the wrong time.

Nonetheless, considering how powerful the wealth generation of stocks can be, it's easy to understand why so many investors want to try their luck.

Matt Krantz is a financial markets reporter at USA TODAY and author of Investing Online for Dummies and Fundamental Analysis for Dummies. He answers a different reader question every weekday in his Ask Matt column at money.usatoday.com. To submit a question, e-mail Matt at mkrantz@usatoday.com. Follow Matt on Twitter at: twitter.com/mattkrantz

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