“I buy on the assumption that they could close the market the next day and not reopen it for five years.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a five year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into F5 Networks, Inc. (NASD: FFIV)? Today, we examine the outcome of a five year investment into the stock back in 2014.
| Start date: | 05/14/2014 |
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| End date: | 05/13/2019 | ||||
| Start price/share: | $103.43 | ||||
| End price/share: | $143.45 | ||||
| Starting shares: | 96.68 | ||||
| Ending shares: | 96.68 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 38.69% | ||||
| Average annual return: | 6.76% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $13,868.93 | ||||
As shown above, the five year investment result worked out well, with an annualized rate of return of 6.76%. This would have turned a $10K investment made 5 years ago into $13,868.93 today (as of 05/13/2019). On a total return basis, that’s a result of 38.69% (something to think about: how might FFIV shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
More investment wisdom to ponder:
“The stock market is the story of cycles and of the human behavior that is responsible for overreactions in both directions.” — Seth Klarman
