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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 two-decade holding period possibly?

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

Start date: 08/13/2001


End date: 08/11/2021
Start price/share: $44.05
End price/share: $208.51
Starting shares: 227.01
Ending shares: 227.01
Dividends reinvested/share: $0.00
Total return: 373.35%
Average annual return: 8.08%
Starting investment: $10,000.00
Ending investment: $47,335.19

As shown above, the two-decade investment result worked out well, with an annualized rate of return of 8.08%. This would have turned a $10K investment made 20 years ago into $47,335.19 today (as of 08/11/2021). On a total return basis, that’s a result of 373.35% (something to think about: how might MHK shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

One more investment quote to leave you with:
“Sentimentality about an investments leads to lack of discipline.” — Sam Zell