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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 Warren Buffett investment philosophy calls for a long-term investment horizon, where a decade-long holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Mosaic Co (NYSE: MOS)? Today, we examine the outcome of a decade-long investment into the stock back in 2010.

Start date: 10/15/2010


End date: 10/14/2020
Start price/share: $68.39
End price/share: $19.31
Starting shares: 146.22
Ending shares: 172.99
Dividends reinvested/share: $6.13
Total return: -66.60%
Average annual return: -10.38%
Starting investment: $10,000.00
Ending investment: $3,340.32

As shown above, the decade-long investment result worked out poorly, with an annualized rate of return of -10.38%. This would have turned a $10K investment made 10 years ago into $3,340.32 today (as of 10/14/2020). On a total return basis, that’s a result of -66.60% (something to think about: how might MOS shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Notice that Mosaic Co paid investors a total of $6.13/share in dividends over the 10 holding period, marking a second component of the total return beyond share price change alone. Much like watering a tree, reinvesting dividends can help an investment to grow over time — for the above calculations we assume dividend reinvestment (and for this exercise the closing price on ex-date is used for the reinvestment of a given dividend).

Based upon the most recent annualized dividend rate of .2/share, we calculate that MOS has a current yield of approximately 1.04%. Another interesting datapoint we can examine is ‘yield on cost’ — in other words, we can express the current annualized dividend of .2 against the original $68.39/share purchase price. This works out to a yield on cost of 1.52%.

One more piece of investment wisdom to leave you with:
“The person who starts simply with the idea of getting rich won’t succeed; you must have a larger ambition.” — John Rockefeller