“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 ten year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Carmax Inc. (NYSE: KMX)? Today, we examine the outcome of a ten year investment into the stock back in 2010.
| Start date: | 03/05/2010 |
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| End date: | 03/04/2020 | ||||
| Start price/share: | $23.30 | ||||
| End price/share: | $90.70 | ||||
| Starting shares: | 429.18 | ||||
| Ending shares: | 429.18 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 289.27% | ||||
| Average annual return: | 14.55% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $38,929.08 | ||||
The above analysis shows the ten year investment result worked out quite well, with an annualized rate of return of 14.55%. This would have turned a $10K investment made 10 years ago into $38,929.08 today (as of 03/04/2020). On a total return basis, that’s a result of 289.27% (something to think about: how might KMX shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Here’s one more great investment quote before you go:
“Sentimentality about an investments leads to lack of discipline.” — Sam Zell
