“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 Incyte Corporation (NASD: INCY)? Today, we examine the outcome of a five year investment into the stock back in 2019.
| Start date: | 12/18/2019 |
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| End date: | 12/17/2024 | ||||
| Start price/share: | $91.18 | ||||
| End price/share: | $69.40 | ||||
| Starting shares: | 109.67 | ||||
| Ending shares: | 109.67 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | -23.89% | ||||
| Average annual return: | -5.31% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $7,611.24 | ||||
As shown above, the five year investment result worked out poorly, with an annualized rate of return of -5.31%. This would have turned a $10K investment made 5 years ago into $7,611.24 today (as of 12/17/2024). On a total return basis, that’s a result of -23.89% (something to think about: how might INCY shares perform over the next 5 years?). [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]
One more investment quote to leave you with:
“There’s a virtuous cycle when people have to defend challenges to their ideas. Any gaps in thinking or analysis become clear pretty quickly when smart people ask good, logical questions.” — Joel Greenblatt
