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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 Mohawk Industries, Inc. (NYSE: MHK)? Today, we examine the outcome of a five year investment into the stock back in 2015.

Start date: 03/26/2015
$10,000

03/26/2015
$4,575

03/25/2020
End date: 03/25/2020
Start price/share: $180.09
End price/share: $82.37
Starting shares: 55.53
Ending shares: 55.53
Dividends reinvested/share: $0.00
Total return: -54.26%
Average annual return: -14.47%
Starting investment: $10,000.00
Ending investment: $4,575.16

As shown above, the five year investment result worked out poorly, with an annualized rate of return of -14.47%. This would have turned a $10K investment made 5 years ago into $4,575.16 today (as of 03/25/2020). On a total return basis, that’s a result of -54.26% (something to think about: how might MHK 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:
“If you have more than 120 or 130 I.Q. points, you can afford to give the rest away. You don’t need extraordinary intelligence to succeed as an investor.” — Warren Buffett