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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 Mohawk Industries, Inc. (NYSE: MHK)? Today, we examine the outcome of a five year investment into the stock back in 2016.

Start date: 08/29/2016


End date: 08/26/2021
Start price/share: $211.23
End price/share: $201.09
Starting shares: 47.34
Ending shares: 47.34
Dividends reinvested/share: $0.00
Total return: -4.80%
Average annual return: -0.98%
Starting investment: $10,000.00
Ending investment: $9,520.02

As shown above, the five year investment result worked out poorly, with an annualized rate of return of -0.98%. This would have turned a $10K investment made 5 years ago into $9,520.02 today (as of 08/26/2021). On a total return basis, that’s a result of -4.80% (something to think about: how might MHK 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:
“Value investing is at its core the marriage of a contrarian streak and a calculator.” — Seth Klarman