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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

The above quote from Warren Buffett is timeless, and brings into focus the choice about time horizon that any investor should think about before buying a stock they are considering. Behind every stock is an actual business; what will that business look like over a ten year period?

Today, let’s look backwards in time to 2010, and take a look at what happened to investors who asked that very question about Alexion Pharmaceuticals Inc. (NASD: ALXN), by taking a look at the investment outcome over a ten year holding period.

Start date: 06/15/2010


End date: 06/12/2020
Start price/share: $26.93
End price/share: $109.30
Starting shares: 371.33
Ending shares: 371.33
Dividends reinvested/share: $0.00
Total return: 305.87%
Average annual return: 15.04%
Starting investment: $10,000.00
Ending investment: $40,596.51

As shown above, the ten year investment result worked out exceptionally well, with an annualized rate of return of 15.04%. This would have turned a $10K investment made 10 years ago into $40,596.51 today (as of 06/12/2020). On a total return basis, that’s a result of 305.87% (something to think about: how might ALXN 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:
“People who succeed in the stock market also accept periodic losses, setbacks, and unexpected occurrences. Calamitous drops do not scare them out of the game.” — Peter Lynch