Photo credit:

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

— Warren Buffett

This inspiring quote from Warren Buffett teaches us the importance of considering our investment time horizon when approaching any given investment: Could we envision ourselves holding the stock we are considering for many years? Even a two-decade holding period potentially?

For “buy-and-hold” investors taking a long-term view, what’s important isn’t the short-term stock market fluctuations that will inevitably occur, but what happens over the long haul. Looking back 20 years to 2003, investors considering an investment into shares of Inc (NASD: AMZN) may have been pondering this very question and thinking about their potential investment result over a full two-decade time horizon. Here’s how that would have worked out.

Start date: 12/29/2003


End date: 12/26/2023
Start price/share: $2.67
End price/share: $153.41
Starting shares: 3,745.32
Ending shares: 3,745.32
Dividends reinvested/share: $0.00
Total return: 5,645.69%
Average annual return: 22.45%
Starting investment: $10,000.00
Ending investment: $574,986.64

As shown above, the two-decade investment result worked out exceptionally well, with an annualized rate of return of 22.45%. This would have turned a $10K investment made 20 years ago into $574,986.64 today (as of 12/26/2023). On a total return basis, that’s a result of 5,645.69% (something to think about: how might AMZN shares perform over the next 20 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

Here’s one more great investment quote before you go:
“When you sell in desperation, you always sell cheap.” — Peter Lynch