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“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 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 ten year holding period for an investor who was considering Inc (NASD: AMZN) back in 2009, bought the stock, ignored the market’s ups and downs, and simply held through to today.

Start date: 10/08/2009


End date: 10/07/2019
Start price/share: $95.22
End price/share: $1,732.66
Starting shares: 105.02
Ending shares: 105.02
Dividends reinvested/share: $0.00
Total return: 1,719.64%
Average annual return: 33.65%
Starting investment: $10,000.00
Ending investment: $181,984.65

The above analysis shows the ten year investment result worked out exceptionally well, with an annualized rate of return of 33.65%. This would have turned a $10K investment made 10 years ago into $181,984.65 today (as of 10/07/2019). On a total return basis, that’s a result of 1,719.64% (something to think about: how might AMZN shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Another great investment quote to think about:
“If a speculator is correct half of the time, he is hitting a good average. Even being right 3 or 4 times out of 10 should yield a person a fortune if he has the sense to cut his losses quickly on the ventures where he is wrong.” — Bernard Baruch