“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 Nektar Therapeutics (NASD: NKTR)? Today, we examine the outcome of a five year investment into the stock back in 2014.
| Start date: | 06/19/2014 |
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| End date: | 06/18/2019 | ||||
| Start price/share: | $13.50 | ||||
| End price/share: | $35.17 | ||||
| Starting shares: | 740.74 | ||||
| Ending shares: | 740.74 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 160.52% | ||||
| Average annual return: | 21.11% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $26,055.54 | ||||
As we can see, the five year investment result worked out exceptionally well, with an annualized rate of return of 21.11%. This would have turned a $10K investment made 5 years ago into $26,055.54 today (as of 06/18/2019). On a total return basis, that’s a result of 160.52% (something to think about: how might NKTR 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:
“You can get in much more trouble with a good idea than a bad idea, because you forget that the good idea has limits.” — Benjamin Graham
