“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”
— Warren Buffett
The investment philosophy practiced by Warren Buffett calls for investors to take a long-term horizon when making an investment, such as a decade-long holding period (or even longer), and reconsider making the investment in the first place if unable to envision holding the stock for at least five years. Today, we look at how such a long-term strategy would have done for investors in Illumina Inc (NASD: ILMN) back in 2013, holding through to today.
| Start date: | 12/19/2013 |
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| End date: | 12/18/2023 | ||||
| Start price/share: | $103.51 | ||||
| End price/share: | $129.10 | ||||
| Starting shares: | 96.61 | ||||
| Ending shares: | 96.61 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 24.72% | ||||
| Average annual return: | 2.23% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $12,468.37 | ||||
As we can see, the decade-long investment result worked out as follows, with an annualized rate of return of 2.23%. This would have turned a $10K investment made 10 years ago into $12,468.37 today (as of 12/18/2023). On a total return basis, that’s a result of 24.72% (something to think about: how might ILMN shares perform over the next 10 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Another great investment quote to think about:
“The individual investor should act consistently as an investor and not as a speculator. This means that he should be able to justify every purchase he makes and each price he pays by impersonal, objective reasoning that satisfies him that he is getting more than his money’s worth for his purchase.” — Benjamin Graham
