It is great to see Lloyds Banking Group (LSE: Lloy) Shares so far by 25% in 2025. It has already changed 10,000 pounds at the beginning of the year to 12,500 pounds.

We see 31% profit in five years, which would take 10,000 GBP to 13 100 GBP. Oh, plus five years of dividends. But even five years is still a low time for long -term stupid investors. What does long -term say?

Two decades

Let’s pick up from 20 years to 2005 before Covid, Brexit, PPI incorrectly selling … and even before the banking crisis in 2008.

At the end of February 2005, Lloyds shares sold at 318 pence. At the time of writing, we look at the price of 68 pence. This is a 79% decrease that would reduce 10,000 GBP to just 2100 GBP. Ouch! What can we learn? I think a lot and that’s not all.

Thanks to dividends, our actual losses would not be so high. No, Lloyds paid a total of 141 pence per share during this period. We could sit at a total value for the action today 209 pence.

This is still a 34%loss that would leave our 10,000 pounds worth $ 6,600. It’s still not great. But it is not that we can expect from the second largest FTSE sector failure, which I remember. The Dot COM disaster was the largest.

Winning diversification

It also shows the importance of diversification. In the same twenty decades, FTSE 100 It increased by 75%. Add the same again in dividends, and just take 10,000 pounds to 25,000 pounds. This includes Lloyds and other banks. It also covers the period from Ocotber 2007 to February 2021, when Footie recorded zero growth.

Stock market investors have gone 20 years of high risk. But look how good we could get out of it if we were well diverse.

Diversification can be complex when we start. I bought a little Barclays Shares in 2007 just before the great disaster. If it wasn’t a part of the varied ISA, I could quickly lose three quarters of my money.

One way to reduce risk would be to choose something like this Ishares Core FTSE 100 UCITS ETF. This is a stock exchange fund that he follows FTSE 100. Over 20 years, something like this can go strictly to the index, less miniature annual fee. We get the maximum diversification of FTSE 100 from one purchase.

Investment Trusty

I also like investment funds and I have a couple, including City of London Investment Trust. He does not try to follow the market, but instead chooses a series of dividend payment in Great Britain. He offers a diversification package again. And he raised the dividend for 58 years in a row.

I have one basic look at the last 20 years of Lloyds. Even someone buying Lloyds could still do well if he was part of a different strategy.