What if you bought Vale in 2005?
World · Brazil. The hindsight answer, year by year, against the only benchmark that matters.
Could you have picked it? Play1.4× · S&P 500 same money: $5,763
$1,000 in Vale at the start of 2005 would be worth about $1,375 today. A plain S&P 500 index fund over the same years would have made more — the boring option won.
The story
Vale, privatised in 1997, is one of the world's largest iron-ore miners, digging up much of the high-grade ore that Chinese steel mills turned into apartment blocks and railways. It bought the Canadian nickel producer Inco in 2006 and rode the commodity supercycle: as China's appetite grew, iron-ore prices multiplied and the shares quadrupled between 2005 and 2008. They held near those levels until the iron-ore price peaked around 2011, then collapsed as Chinese construction slowed and new supply from Australia flooded in, bottoming in 2015-2016.
Worse than the cycle were the dams. In November 2015 the tailings dam at Samarco, a joint venture with BHP, burst near Mariana, causing Brazil's worst environmental disaster. In January 2019 a Vale dam at Brumadinho collapsed, killing around 270 people, leading to criminal charges against executives and billions in compensation. Vale paid generous dividends in strong years, but over the full period the share price ended roughly where it stood in the mid-2000s, with much of the round trip driven by Chinese steel demand.
The lesson: A commodity miner is a leveraged bet on its biggest customer's appetite, and tailings-dam disasters show that environmental risk becomes financial risk overnight.
$1,000 invested at the start of each year
| Bought in | Price then | Worth today | S&P 500 would be | Multiple |
|---|---|---|---|---|
| 2005 | $8.00 | $1,375 | $5,763 | 1.4× |
| 2007 | $15.00 | $733 | $4,789 | 0.7× |
| 2008 | $30.00 | $367 | $4,626 | 0.4× |
| 2010 | $30.00 | $367 | $6,071 | 0.4× |
| 2012 | $22.00 | $500 | $5,312 | 0.5× |
| 2015 | $8.00 | $1,375 | $3,301 | 1.4× |
| 2018 | $12.00 | $917 | $2,519 | 0.9× |
| 2020 | $13.00 | $846 | $2,092 | 0.8× |
green = beat the S&P 500 · red = lost money
Best entry point in our set: 2005, turning $1,000 into $1,375. The S&P 500 from that same year: $5,763.
On this day
Now try it without hindsight. The wheel decides the year and the asset class, you pick the position, ten seconds a pick, and we simulate to today. Vale is one of 258 positions on the wheel — including the ones that went to zero.
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