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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

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 five year holding period possibly?

Suppose a “buy-and-hold” investor was considering an investment into Autodesk Inc (NASD: ADSK) back in 2015: back then, such an investor may have been pondering this very same question. Had they answered “yes” to a full five year investment time horizon and then actually held for these past 5 years, here’s how that investment would have turned out.

Start date: 09/02/2015
$10,000

09/02/2015
$55,113

09/01/2020
End date: 09/01/2020
Start price/share: $45.99
End price/share: $253.51
Starting shares: 217.44
Ending shares: 217.44
Dividends reinvested/share: $0.00
Total return: 451.23%
Average annual return: 40.66%
Starting investment: $10,000.00
Ending investment: $55,113.63

As we can see, the five year investment result worked out exceptionally well, with an annualized rate of return of 40.66%. This would have turned a $10K investment made 5 years ago into $55,113.63 today (as of 09/01/2020). On a total return basis, that’s a result of 451.23% (something to think about: how might ADSK shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Here’s one more great investment quote before you go:
“Every once in a while, the market does something so stupid it takes your breath away.” — Jim Cramer