“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”
— Warren Buffett
Investors can learn a lot from Warren Buffett, whose above quote teaches the importance of thinking about investment time horizon, and asking ourselves before buying any given stock: can we envision holding onto it for years — even a decade-long holding period possibly?
Suppose a “buy-and-hold” investor was considering an investment into Salesforce.com Inc (NYSE: CRM) back in 2010: back then, such an investor may have been pondering this very same question. Had they answered “yes” to a full decade-long investment time horizon and then actually held for these past 10 years, here’s how that investment would have turned out.
|Average annual return:||27.28%|
The above analysis shows the decade-long investment result worked out exceptionally well, with an annualized rate of return of 27.28%. This would have turned a $10K investment made 10 years ago into $111,510.21 today (as of 01/29/2020). On a total return basis, that’s a result of 1,015.15% (something to think about: how might CRM shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more piece of investment wisdom to leave you with:
“In the long run, we are all dead.” — John Maynard Keynes