“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 Illumina Inc (NASD: ILMN)? Today, we examine the outcome of a five year investment into the stock back in 2019.
| Start date: | 06/20/2019 |
|
|||
| End date: | 06/18/2024 | ||||
| Start price/share: | $358.57 | ||||
| End price/share: | $108.10 | ||||
| Starting shares: | 27.89 | ||||
| Ending shares: | 27.89 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | -69.85% | ||||
| Average annual return: | -21.32% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $3,015.24 | ||||
As shown above, the five year investment result worked out poorly, with an annualized rate of return of -21.32%. This would have turned a $10K investment made 5 years ago into $3,015.24 today (as of 06/18/2024). On a total return basis, that’s a result of -69.85% (something to think about: how might ILMN shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
Another great investment quote to think about:
“If you are not willing to own a stock for 10 years, do not even think about owning it for 10 minutes.” — Warren Buffett
