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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

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 five year holding period for an investor who was considering Fiserv Inc (NASD: FISV) back in 2014, bought the stock, ignored the market’s ups and downs, and simply held through to today.

Start date: 10/23/2014
$10,000

10/23/2014
$30,959

10/22/2019
End date: 10/22/2019
Start price/share: $32.55
End price/share: $100.79
Starting shares: 307.22
Ending shares: 307.22
Dividends reinvested/share: $0.00
Total return: 209.65%
Average annual return: 25.36%
Starting investment: $10,000.00
Ending investment: $30,959.57

As shown above, the five year investment result worked out exceptionally well, with an annualized rate of return of 25.36%. This would have turned a $10K investment made 5 years ago into $30,959.57 today (as of 10/22/2019). On a total return basis, that’s a result of 209.65% (something to think about: how might FISV shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

More investment wisdom to ponder:
“The most important three words in investing is: “I don’t know.” If someone doesn’t say that to you then they are lying.” — James Altucher