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“I buy on the assumption that they could close the market the next day and not reopen it for five years.”

— Warren Buffett

Investors can learn a lot from Warren Buffett, whose above quote teaches the importance of thinking about investment time horizon, and asking ourselves before buying any given stock: can we envision holding onto it for years — even a five year holding period possibly?

Suppose a “buy-and-hold” investor was considering an investment into IQVIA Holdings Inc (NYSE: IQV) back in 2014: back then, such an investor may have been pondering this very same question. Had they answered “yes” to a full five year investment time horizon and then actually held for these past 5 years, here’s how that investment would have turned out.

Start date: 03/18/2014


End date: 03/15/2019
Start price/share: $52.96
End price/share: $141.53
Starting shares: 188.82
Ending shares: 188.82
Dividends reinvested/share: $0.00
Total return: 167.24%
Average annual return: 21.75%
Starting investment: $10,000.00
Ending investment: $26,722.47

As we can see, the five year investment result worked out exceptionally well, with an annualized rate of return of 21.75%. This would have turned a $10K investment made 5 years ago into $26,722.47 today (as of 03/15/2019). On a total return basis, that’s a result of 167.24% (something to think about: how might IQV shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

One more investment quote to leave you with:
“All intelligent investing is value investing: acquiring more that you are paying for. You must value the business in order to value the stock.” — Charlie Munger