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“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”

— Warren Buffett

One of the most important things investors can learn from Warren Buffett, is about how they approach their time horizon for an investment into a stock under consideration. Because immediately after buying shares of a given stock, investors will then be able to check on the day-to-day (and even minute-by-minute) market value. Some days the stock market will be up, other days down. These daily fluctuations can often distract from the long-term view. Today, we look at the result of a two-decade holding period for an investor who was considering Dollar Tree Inc (NASD: DLTR) back in 1999, bought the stock, ignored the market’s ups and downs, and simply held through to today.

Start date: 07/12/1999


End date: 07/11/2019
Start price/share: $9.63
End price/share: $110.97
Starting shares: 1,038.42
Ending shares: 1,038.42
Dividends reinvested/share: $0.00
Total return: 1,052.34%
Average annual return: 12.99%
Starting investment: $10,000.00
Ending investment: $115,181.16

As we can see, the two-decade investment result worked out quite well, with an annualized rate of return of 12.99%. This would have turned a $10K investment made 20 years ago into $115,181.16 today (as of 07/11/2019). On a total return basis, that’s a result of 1,052.34% (something to think about: how might DLTR shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Another great investment quote to think about:
“History provides a crucial insight regarding market crises: they are inevitable, painful and ultimately surmountable.” — Shelby Davis