“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a decade-long holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Vertex Pharmaceuticals, Inc. (NASD: VRTX)? Today, we examine the outcome of a decade-long investment into the stock back in 2010.
| Start date: | 01/19/2010 |
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| End date: | 01/15/2020 | ||||
| Start price/share: | $41.68 | ||||
| End price/share: | $234.15 | ||||
| Starting shares: | 239.92 | ||||
| Ending shares: | 239.92 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 461.78% | ||||
| Average annual return: | 18.85% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $56,179.89 | ||||
The above analysis shows the decade-long investment result worked out exceptionally well, with an annualized rate of return of 18.85%. This would have turned a $10K investment made 10 years ago into $56,179.89 today (as of 01/15/2020). On a total return basis, that’s a result of 461.78% (something to think about: how might VRTX 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:
“If you can follow only one bit of data, follow the earnings.” — Peter Lynch
