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“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”

— 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 twenty year holding period possibly?

Suppose a “buy-and-hold” investor was considering an investment into Biogen Inc (NASD: BIIB) back in 2001: back then, such an investor may have been pondering this very same question. Had they answered “yes” to a full twenty year investment time horizon and then actually held for these past 20 years, here’s how that investment would have turned out.

Start date: 01/25/2001


End date: 01/22/2021
Start price/share: $61.77
End price/share: $269.44
Starting shares: 161.90
Ending shares: 161.90
Dividends reinvested/share: $0.00
Total return: 336.23%
Average annual return: 7.64%
Starting investment: $10,000.00
Ending investment: $43,616.32

As shown above, the twenty year investment result worked out well, with an annualized rate of return of 7.64%. This would have turned a $10K investment made 20 years ago into $43,616.32 today (as of 01/22/2021). On a total return basis, that’s a result of 336.23% (something to think about: how might BIIB shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

One more piece of investment wisdom to leave you with:
“We don’t have to be smarter than the rest. We have to be more disciplined than the rest.” — Warren Buffett