“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a twenty year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Akamai Technologies Inc (NASD: AKAM)? Today, we examine the outcome of a twenty year investment into the stock back in 2000.
| Start date: | 08/31/2000 |
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| End date: | 08/28/2020 | ||||
| Start price/share: | $75.56 | ||||
| End price/share: | $115.63 | ||||
| Starting shares: | 132.34 | ||||
| Ending shares: | 132.34 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 53.03% | ||||
| Average annual return: | 2.15% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $15,304.46 | ||||
As we can see, the twenty year investment result worked out as follows, with an annualized rate of return of 2.15%. This would have turned a $10K investment made 20 years ago into $15,304.46 today (as of 08/28/2020). On a total return basis, that’s a result of 53.03% (something to think about: how might AKAM shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
More investment wisdom to ponder:
“As time goes on, I get more and more convinced that the right method of investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes.” — John Maynard Keynes
