“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 Advanced Micro Devices Inc (NASD: AMD)? 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: | $3.98 | ||||
| End price/share: | $26.24 | ||||
| Starting shares: | 2,512.56 | ||||
| Ending shares: | 2,512.56 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 559.30% | ||||
| Average annual return: | 45.82% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $65,930.36 | ||||
The above analysis shows the five year investment result worked out exceptionally well, with an annualized rate of return of 45.82%. This would have turned a $10K investment made 5 years ago into $65,930.36 today (as of 05/13/2019). On a total return basis, that’s a result of 559.30% (something to think about: how might AMD shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Another great investment quote to think about:
“There is nothing riskier than the widespread perception that there is no risk.” — Howard Marks
