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

— 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 two-decade holding period for an investor who was considering Advanced Micro Devices Inc (NASD: AMD) back in 2003, bought the stock, ignored the market’s ups and downs, and simply held through to today.

Start date: 08/25/2003


End date: 08/23/2023
Start price/share: $10.09
End price/share: $109.43
Starting shares: 991.08
Ending shares: 991.08
Dividends reinvested/share: $0.00
Total return: 984.54%
Average annual return: 12.65%
Starting investment: $10,000.00
Ending investment: $108,404.95

The above analysis shows the two-decade investment result worked out quite well, with an annualized rate of return of 12.65%. This would have turned a $10K investment made 20 years ago into $108,404.95 today (as of 08/23/2023). On a total return basis, that’s a result of 984.54% (something to think about: how might AMD 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:
“All intelligent investing is value investing: acquiring more that you are paying for. You must value the business in order to value the stock.” — Charlie Munger