“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 Synopsys Inc (NASD: SNPS)? Today, we examine the outcome of a five year investment into the stock back in 2014.
| Start date: | 08/01/2014 |
|
|||
| End date: | 07/31/2019 | ||||
| Start price/share: | $37.81 | ||||
| End price/share: | $132.76 | ||||
| Starting shares: | 264.48 | ||||
| Ending shares: | 264.48 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 251.12% | ||||
| Average annual return: | 28.56% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $35,117.96 | ||||
As shown above, the five year investment result worked out exceptionally well, with an annualized rate of return of 28.56%. This would have turned a $10K investment made 5 years ago into $35,117.96 today (as of 07/31/2019). On a total return basis, that’s a result of 251.12% (something to think about: how might SNPS 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:
“The function of economic forecasting is to make astrology look respectable.” — John Galbraith
