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

— 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 SVB Financial Group (NASD: SIVB) 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: 06/28/2001


End date: 06/25/2021
Start price/share: $21.48
End price/share: $564.71
Starting shares: 465.55
Ending shares: 465.55
Dividends reinvested/share: $0.00
Total return: 2,529.00%
Average annual return: 17.75%
Starting investment: $10,000.00
Ending investment: $262,788.98

As shown above, the twenty year investment result worked out exceptionally well, with an annualized rate of return of 17.75%. This would have turned a $10K investment made 20 years ago into $262,788.98 today (as of 06/25/2021). On a total return basis, that’s a result of 2,529.00% (something to think about: how might SIVB shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Here’s one more great investment quote before you go:
“You don’t need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ.” — Warren Buffett