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

— Warren Buffett

One of the most important things investors can learn from Warren Buffett, is about how they approach their time horizon for an investment into a stock under consideration. Because immediately after buying shares of a given stock, investors will then be able to check on the day-to-day (and even minute-by-minute) market value. Some days the stock market will be up, other days down. These daily fluctuations can often distract from the long-term view. Today, we look at the result of a five year holding period for an investor who was considering Molina Healthcare Inc (NYSE: MOH) back in 2017, bought the stock, ignored the market’s ups and downs, and simply held through to today.

Start date: 11/07/2017


End date: 11/04/2022
Start price/share: $77.53
End price/share: $330.55
Starting shares: 128.98
Ending shares: 128.98
Dividends reinvested/share: $0.00
Total return: 326.35%
Average annual return: 33.71%
Starting investment: $10,000.00
Ending investment: $42,636.59

The above analysis shows the five year investment result worked out exceptionally well, with an annualized rate of return of 33.71%. This would have turned a $10K investment made 5 years ago into $42,636.59 today (as of 11/04/2022). On a total return basis, that’s a result of 326.35% (something to think about: how might MOH shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

More investment wisdom to ponder:
“Sometimes buying early on the way down looks like being wrong, but it isn’t.” — Seth Klarman