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“Someone’s sitting in the shade today because someone planted a tree a long time ago.”

— Warren Buffett

One of the most important things investors can learn from Warren Buffett, is about how they approach their time horizon for an investment into a stock under consideration. Because immediately after buying shares of a given stock, investors will then be able to check on the day-to-day (and even minute-by-minute) market value. Some days the stock market will be up, other days down. These daily fluctuations can often distract from the long-term view. Today, we look at the result of a two-decade holding period for an investor who was considering Biogen Inc (NASD: BIIB) back in 2000, bought the stock, ignored the market’s ups and downs, and simply held through to today.

Start date: 06/05/2000


End date: 06/02/2020
Start price/share: $88.75
End price/share: $302.86
Starting shares: 112.68
Ending shares: 112.68
Dividends reinvested/share: $0.00
Total return: 241.25%
Average annual return: 6.33%
Starting investment: $10,000.00
Ending investment: $34,139.91

The above analysis shows the two-decade investment result worked out well, with an annualized rate of return of 6.33%. This would have turned a $10K investment made 20 years ago into $34,139.91 today (as of 06/02/2020). On a total return basis, that’s a result of 241.25% (something to think about: how might BIIB shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Here’s one more great investment quote before you go:
“The greater the passive income you can build, the freer you will become.” — Todd Fleming