“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 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 decade-long period?
Today, let’s look backwards in time to 2012, and take a look at what happened to investors who asked that very question about Incyte Corporation (NASD: INCY), by taking a look at the investment outcome over a decade-long holding period.
|Average annual return:||13.47%|
As we can see, the decade-long investment result worked out quite well, with an annualized rate of return of 13.47%. This would have turned a $10K investment made 10 years ago into $35,396.55 today (as of 08/29/2022). On a total return basis, that’s a result of 253.97% (something to think about: how might INCY shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Another great investment quote to think about:
“Calling someone who trades actively in the market an investor is like calling someone who repeatedly engages in one-night stands a romantic.” — Warren Buffett