“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 United Airlines Holdings Inc (NASD: UAL)? Today, we examine the outcome of a five year investment into the stock back in 2017.
| Start date: | 02/17/2017 |
|
|||
| End date: | 02/16/2022 | ||||
| Start price/share: | $75.96 | ||||
| End price/share: | $50.21 | ||||
| Starting shares: | 131.65 | ||||
| Ending shares: | 131.65 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | -33.90% | ||||
| Average annual return: | -7.95% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $6,608.74 | ||||
As shown above, the five year investment result worked out poorly, with an annualized rate of return of -7.95%. This would have turned a $10K investment made 5 years ago into $6,608.74 today (as of 02/16/2022). On a total return basis, that’s a result of -33.90% (something to think about: how might UAL shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more investment quote to leave you with:
“You make most of your money in a bear market, you just don’t realize it at the time.” — Shelby Davis
