Photo credit:

“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 2018.

Start date: 10/02/2018


End date: 09/29/2023
Start price/share: $86.71
End price/share: $42.30
Starting shares: 115.33
Ending shares: 115.33
Dividends reinvested/share: $0.00
Total return: -51.22%
Average annual return: -13.39%
Starting investment: $10,000.00
Ending investment: $4,877.33

The above analysis shows the five year investment result worked out poorly, with an annualized rate of return of -13.39%. This would have turned a $10K investment made 5 years ago into $4,877.33 today (as of 09/29/2023). On a total return basis, that’s a result of -51.22% (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:
“While some might mistakenly consider value investing a mechanical tool for identifying bargains, it is actually a comprehensive investment philosophy that emphasizes the need to perform in-depth fundamental analysis, pursue long-term investment results, limit risk, and resist crowd psychology.” — Seth Klarman