“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: | 10/26/2017 |
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| End date: | 10/25/2022 | ||||
| Start price/share: | $59.95 | ||||
| End price/share: | $42.60 | ||||
| Starting shares: | 166.81 | ||||
| Ending shares: | 166.81 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | -28.94% | ||||
| Average annual return: | -6.60% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $7,107.79 | ||||
As we can see, the five year investment result worked out poorly, with an annualized rate of return of -6.60%. This would have turned a $10K investment made 5 years ago into $7,107.79 today (as of 10/25/2022). On a total return basis, that’s a result of -28.94% (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.]
Another great investment quote to think about:
“The investor’s chief problem, even his worst enemy, is likely to be himself.” — Benjamin Graham
