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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

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 Inc (NASD: AMZN)? Today, we examine the outcome of a five year investment into the stock back in 2016.

Start date: 02/17/2016


End date: 02/16/2021
Start price/share: $534.10
End price/share: $3,268.95
Starting shares: 18.72
Ending shares: 18.72
Dividends reinvested/share: $0.00
Total return: 512.05%
Average annual return: 43.64%
Starting investment: $10,000.00
Ending investment: $61,207.96

As we can see, the five year investment result worked out exceptionally well, with an annualized rate of return of 43.64%. This would have turned a $10K investment made 5 years ago into $61,207.96 today (as of 02/16/2021). On a total return basis, that’s a result of 512.05% (something to think about: how might AMZN shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Another great investment quote to think about:
“While it might seem that anyone can be a value investor, the essential characteristics of this type of investor-patience, discipline, and risk aversion-may well be genetically determined.” — Seth Klarman