“I buy on the assumption that they could close the market the next day and not reopen it for five years.”
— Warren Buffett
The Warren Buffett investment philosophy calls for a long-term investment horizon, where a five year holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Incyte Corporation (NASD: INCY)? Today, we examine the outcome of a five year investment into the stock back in 2015.
| Start date: | 12/31/2015 |
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| End date: | 12/30/2020 | ||||
| Start price/share: | $108.45 | ||||
| End price/share: | $86.86 | ||||
| Starting shares: | 92.21 | ||||
| Ending shares: | 92.21 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | -19.91% | ||||
| Average annual return: | -4.34% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $8,009.38 | ||||
As shown above, the five year investment result worked out poorly, with an annualized rate of return of -4.34%. This would have turned a $10K investment made 5 years ago into $8,009.38 today (as of 12/30/2020). On a total return basis, that’s a result of -19.91% (something to think about: how might INCY shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more investment quote to leave you with:
“If investing is entertaining, if you’re having fun, you’re probably not making any money. Good investing is boring.” — George Soros
