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 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 five year period?

Today, let’s look backwards in time to 2019, and take a look at what happened to investors who asked that very question about Advanced Micro Devices Inc (NASD: AMD), by taking a look at the investment outcome over a five year holding period.

Start date: 03/14/2019


End date: 03/13/2024
Start price/share: $22.82
End price/share: $194.79
Starting shares: 438.21
Ending shares: 438.21
Dividends reinvested/share: $0.00
Total return: 753.59%
Average annual return: 53.51%
Starting investment: $10,000.00
Ending investment: $85,347.99

The above analysis shows the five year investment result worked out exceptionally well, with an annualized rate of return of 53.51%. This would have turned a $10K investment made 5 years ago into $85,347.99 today (as of 03/13/2024). On a total return basis, that’s a result of 753.59% (something to think about: how might AMD shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

More investment wisdom to ponder:
“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