$10k In MNST Proves ‘Buy And Hold’ Is Alive And Well

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— Warren Buffett

Such a great quote from Warren Buffett, highlighting the importance of investment time horizon when considering making an investment. In the short run, who knows what the stock market will do? A week or two after buying any given stock, could the entire stock market fall out of bed? Quite possibly! Should that happen, how would you react? It is an excellent question to think about before hitting the buy button.

For investors who take a multi-year time horizon, the important thing is not what happens in the next week or two, but what the result will be over the long haul. Today, we look at the result investors of the year 2000 experienced, who considered an investment in shares of Monster Beverage Corp (NASD: MNST) and decided upon a twenty year investment time horizon.

MNST 20-Year Return Details
Start date:	02/25/2000	$10,000 02/25/2000 $959,978 02/24/2020
End date:	02/24/2020
Start price/share:	$0.71
End price/share:	$68.19
Starting shares:	14,084.51
Ending shares:	14,084.51
Dividends reinvested/share:	$0.00
Total return:	9,504.23%
Average annual return:	25.62%
Starting investment:	$10,000.00
Ending investment:	$959,978.17

The above analysis shows the twenty year investment result worked out exceptionally well, with an annualized rate of return of 25.62%. This would have turned a $10K investment made 20 years ago into $959,978.17 today (as of 02/24/2020). On a total return basis, that’s a result of 9,504.23% (something to think about: how might MNST shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Another great investment quote to think about:
“As time goes on, I get more and more convinced that the right method of investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes.” — John Maynard Keynes