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“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”

— Warren Buffett

The Warren Buffett investment philosophy calls for a long-term investment horizon, where a two-decade holding period, or even longer, would fit right into the strategy. How would such a strategy have worked out for an investment into Carmax Inc. (NYSE: KMX)? Today, we examine the outcome of a two-decade investment into the stock back in 2001.

Start date: 12/17/2001


End date: 12/14/2021
Start price/share: $11.56
End price/share: $141.31
Starting shares: 865.05
Ending shares: 865.05
Dividends reinvested/share: $0.00
Total return: 1,122.40%
Average annual return: 13.33%
Starting investment: $10,000.00
Ending investment: $122,234.99

The above analysis shows the two-decade investment result worked out quite well, with an annualized rate of return of 13.33%. This would have turned a $10K investment made 20 years ago into $122,234.99 today (as of 12/14/2021). On a total return basis, that’s a result of 1,122.40% (something to think about: how might KMX shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Another great investment quote to think about:
“It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.” — George Soros