Photo credit:

“I buy on the assumption that they could close the market the next day and not reopen it for five years.”

— Warren Buffett

The above quote from Warren Buffett is timeless, and brings into focus the choice about time horizon that any investor should think about before buying a stock they are considering. Behind every stock is an actual business; what will that business look like over a five year period?

Today, let’s look backwards in time to 2016, and take a look at what happened to investors who asked that very question about Advanced Micro Devices Inc (NASD: AMD), by taking a look at the investment outcome over a five year holding period.

Start date: 11/16/2016


End date: 11/15/2021
Start price/share: $7.67
End price/share: $146.49
Starting shares: 1,303.78
Ending shares: 1,303.78
Dividends reinvested/share: $0.00
Total return: 1,809.91%
Average annual return: 80.39%
Starting investment: $10,000.00
Ending investment: $191,012.72

The above analysis shows the five year investment result worked out exceptionally well, with an annualized rate of return of 80.39%. This would have turned a $10K investment made 5 years ago into $191,012.72 today (as of 11/15/2021). On a total return basis, that’s a result of 1,809.91% (something to think about: how might AMD shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Here’s one more great investment quote before you go:
“The emotional burden of trading is substantial; on any given day, I could lose millions of dollars. If you personalize these losses, you can’t trade.” — Bruce Kovner