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“I buy on the assumption that they could close the market the next day and not reopen it for five years.”

— Warren Buffett

The above quote from Warren Buffett is timeless, and brings into focus the choice about time horizon that any investor should think about before buying a stock they are considering. Behind every stock is an actual business; what will that business look like over a five year period?

Today, let’s look backwards in time to 2014, and take a look at what happened to investors who asked that very question about Autodesk Inc (NASD: ADSK), by taking a look at the investment outcome over a five year holding period.

Start date: 09/10/2014
$10,000

09/10/2014
$28,302

09/09/2019
End date: 09/09/2019
Start price/share: $53.37
End price/share: $151.02
Starting shares: 187.37
Ending shares: 187.37
Dividends reinvested/share: $0.00
Total return: 182.97%
Average annual return: 23.13%
Starting investment: $10,000.00
Ending investment: $28,302.15

As shown above, the five year investment result worked out exceptionally well, with an annualized rate of return of 23.13%. This would have turned a $10K investment made 5 years ago into $28,302.15 today (as of 09/09/2019). On a total return basis, that’s a result of 182.97% (something to think about: how might ADSK shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Here’s one more great investment quote before you go:
“A lot of people with high IQs are terrible investors because they’ve got terrible temperaments. You need to keep raw, irrational emotion under control.” — Charlie Munger