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“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 Biogen Inc (NASD: BIIB)? Today, we examine the outcome of a five year investment into the stock back in 2015.

Start date: 02/27/2015
$10,000

02/27/2015
$7,993

02/26/2020
End date: 02/26/2020
Start price/share: $409.59
End price/share: $327.45
Starting shares: 24.41
Ending shares: 24.41
Dividends reinvested/share: $0.00
Total return: -20.05%
Average annual return: -4.38%
Starting investment: $10,000.00
Ending investment: $7,993.62

The above analysis shows the five year investment result worked out poorly, with an annualized rate of return of -4.38%. This would have turned a $10K investment made 5 years ago into $7,993.62 today (as of 02/26/2020). On a total return basis, that’s a result of -20.05% (something to think about: how might BIIB shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

One more piece of investment wisdom to leave you with:
“A lot of people with high IQs are terrible investors because they’ve got terrible temperaments. You need to keep raw, irrational emotion under control.” — Charlie Munger