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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

The above quote from Warren Buffett is timeless, and brings into focus the choice about time horizon that any investor should think about before buying a stock they are considering. Behind every stock is an actual business; what will that business look like over a five year period?

Today, let’s look backwards in time to 2014, and take a look at what happened to investors who asked that very question about Akamai Technologies Inc (NASD: AKAM), by taking a look at the investment outcome over a five year holding period.

Start date: 05/15/2014


End date: 05/14/2019
Start price/share: $53.51
End price/share: $75.72
Starting shares: 186.88
Ending shares: 186.88
Dividends reinvested/share: $0.00
Total return: 41.51%
Average annual return: 7.19%
Starting investment: $10,000.00
Ending investment: $14,150.49

As shown above, the five year investment result worked out well, with an annualized rate of return of 7.19%. This would have turned a $10K investment made 5 years ago into $14,150.49 today (as of 05/14/2019). On a total return basis, that’s a result of 41.51% (something to think about: how might AKAM 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:
“When the public is most frightened, only the strong are left, and that’s when the market is in the best possible hands.” — Victor Niederhoffer