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“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”

— Warren Buffett

Investors can learn a lot from Warren Buffett, whose above quote teaches the importance of thinking about investment time horizon, and asking ourselves before buying any given stock: can we envision holding onto it for years — even a decade-long holding period possibly?

Suppose a “buy-and-hold” investor was considering an investment into Inc (NYSE: CRM) back in 2010: back then, such an investor may have been pondering this very same question. Had they answered “yes” to a full decade-long investment time horizon and then actually held for these past 10 years, here’s how that investment would have turned out.

Start date: 06/11/2010


End date: 06/10/2020
Start price/share: $24.16
End price/share: $182.10
Starting shares: 413.91
Ending shares: 413.91
Dividends reinvested/share: $0.00
Total return: 653.73%
Average annual return: 22.37%
Starting investment: $10,000.00
Ending investment: $75,375.47

As shown above, the decade-long investment result worked out exceptionally well, with an annualized rate of return of 22.37%. This would have turned a $10K investment made 10 years ago into $75,375.47 today (as of 06/10/2020). On a total return basis, that’s a result of 653.73% (something to think about: how might CRM 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:
“A market downturn doesn’t bother us. It is an opportunity to increase our ownership of great companies with great management at good prices.” — Warren Buffett