“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 Norwegian Cruise Line Holdings Ltd (NYSE: NCLH)? Today, we examine the outcome of a five year investment into the stock back in 2019.
| Start date: | 12/31/2019 |
|
|||
| End date: | 12/30/2024 | ||||
| Start price/share: | $58.41 | ||||
| End price/share: | $25.75 | ||||
| Starting shares: | 171.20 | ||||
| Ending shares: | 171.20 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | -55.92% | ||||
| Average annual return: | -15.10% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $4,409.04 | ||||
As we can see, the five year investment result worked out poorly, with an annualized rate of return of -15.10%. This would have turned a $10K investment made 5 years ago into $4,409.04 today (as of 12/30/2024). On a total return basis, that’s a result of -55.92% (something to think about: how might NCLH shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more piece of investment wisdom to leave you with:
“The four most dangerous words in investing are: ‘this time it’s different.'” — Sir John Templeton
