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“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”

— 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 decade-long holding period possibly?

Suppose a “buy-and-hold” investor was considering an investment into Chipotle Mexican Grill Inc (NYSE: CMG) back in 2011: back then, such an investor may have been pondering this very same question. Had they answered “yes” to a full decade-long investment time horizon and then actually held for these past 10 years, here’s how that investment would have turned out.

Start date: 07/14/2011


End date: 07/13/2021
Start price/share: $324.63
End price/share: $1,607.29
Starting shares: 30.80
Ending shares: 30.80
Dividends reinvested/share: $0.00
Total return: 395.11%
Average annual return: 17.34%
Starting investment: $10,000.00
Ending investment: $49,526.93

The above analysis shows the decade-long investment result worked out exceptionally well, with an annualized rate of return of 17.34%. This would have turned a $10K investment made 10 years ago into $49,526.93 today (as of 07/13/2021). On a total return basis, that’s a result of 395.11% (something to think about: how might CMG shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Another great investment quote to think about:
“Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn’t, pays it.” — Albert Einstein