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“Someone’s sitting in the shade today because someone planted a tree a long time ago.”

— Warren Buffett

One of the most important things investors can learn from Warren Buffett, is about how they approach their time horizon for an investment into a stock under consideration. Because immediately after buying shares of a given stock, investors will then be able to check on the day-to-day (and even minute-by-minute) market value. Some days the stock market will be up, other days down. These daily fluctuations can often distract from the long-term view. Today, we look at the result of a twenty year holding period for an investor who was considering DaVita Inc (NYSE: DVA) back in 2001, bought the stock, ignored the market’s ups and downs, and simply held through to today.

Start date: 05/07/2001


End date: 05/06/2021
Start price/share: $6.39
End price/share: $124.30
Starting shares: 1,564.95
Ending shares: 1,564.95
Dividends reinvested/share: $0.00
Total return: 1,845.23%
Average annual return: 15.99%
Starting investment: $10,000.00
Ending investment: $194,588.40

As we can see, the twenty year investment result worked out exceptionally well, with an annualized rate of return of 15.99%. This would have turned a $10K investment made 20 years ago into $194,588.40 today (as of 05/06/2021). On a total return basis, that’s a result of 1,845.23% (something to think about: how might DVA shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Another great investment quote to think about:
“The best way to measure your investing success is not by whether you’re beating the market but by whether you’ve put in place a financial plan and a behavioral discipline that are likely to get you where you want to go.” — Benjamin Graham