“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 Amazon.com Inc (NASD: AMZN)? Today, we examine the outcome of a five year investment into the stock back in 2020.
| Start date: | 12/08/2020 |
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| End date: | 12/05/2025 | ||||
| Start price/share: | $158.86 | ||||
| End price/share: | $229.53 | ||||
| Starting shares: | 62.95 | ||||
| Ending shares: | 62.95 | ||||
| Dividends reinvested/share: | $0.00 | ||||
| Total return: | 44.49% | ||||
| Average annual return: | 7.65% | ||||
| Starting investment: | $10,000.00 | ||||
| Ending investment: | $14,450.90 | ||||
As shown above, the five year investment result worked out well, with an annualized rate of return of 7.65%. This would have turned a $10K investment made 5 years ago into $14,450.90 today (as of 12/05/2025). On a total return basis, that’s a result of 44.49% (something to think about: how might AMZN 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:
“Value investing requires a great deal of hard work, unusually strict discipline, and a long-term investment horizon. Few are willing and able to devote sufficient time and effort to become value investors, and only a fraction of those have the proper mind-set to succeed.” — Seth Klarman
