“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”
— 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 twenty year period?
Today, let’s look backwards in time to 2003, and take a look at what happened to investors who asked that very question about Illumina Inc (NASD: ILMN), by taking a look at the investment outcome over a twenty year holding period.
|Average annual return:||18.72%|
As shown above, the twenty year investment result worked out exceptionally well, with an annualized rate of return of 18.72%. This would have turned a $10K investment made 20 years ago into $309,660.71 today (as of 11/14/2023). On a total return basis, that’s a result of 2,994.92% (something to think about: how might ILMN shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more piece of investment wisdom to leave you with:
“In the end, how your investments behave is much less important than how you behave.” — Benjamin Graham