“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 Berkshire Hathaway Inc New (NYSE: BRK.B)? Today, we examine the outcome of a five year investment into the stock back in 2014.
| Start date: | 10/08/2014 |
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| End date: | 10/07/2019 | ||||
| Start price/share: | $139.94 | ||||
| End price/share: | $207.24 | ||||
| Starting shares: | 71.46 | ||||
| Ending shares: | 71.46 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 48.09% | ||||
| Average annual return: | 8.17% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $14,809.29 | ||||
As shown above, the five year investment result worked out well, with an annualized rate of return of 8.17%. This would have turned a $10K investment made 5 years ago into $14,809.29 today (as of 10/07/2019). On a total return basis, that’s a result of 48.09% (something to think about: how might BRK.B shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more investment quote to leave you with:
“The policy of being too cautious is the greatest risk of all.” — Jawaharlal Nehru
