3-Year Backtest: Buy and Hold NVDA (NVIDIA Corporation)

This analysis evaluates a buy-and-hold strategy over the past 3 years, providing a historical perspective on NVDA's performance from 2022-05-31 to 2025-05-30.

Note: This simulation uses adjusted close prices, meaning all historical prices have been retroactively adjusted for splits and dividends. To achieve similar results in practice, you would need to reinvest all dividends automatically as they are paid.

Performance Overview

Starting with an initial capital of $10,000.00, we purchased shares of NVDA on 2022-05-31, at a price of $18.64 per share (adjusted for splits and dividends). No trading, no adjustments — just a simple buy-and-hold approach.

We held the position continuously through every market twist and turn, never selling. As of 2025-05-30, the price of NVDA had risen to $135.13. While we didn't sell, we can still assess the performance by calculating the current value of the investment: $72,485.06 — a total gain of 624.85%.

This translates into an annualized return of 93.62% over the entire period. This return is exceptionally high and rarely sustained over long periods. While it reflects extraordinary growth, such performance is often accompanied by substantial risk and volatility.

Drawdown and Risk

The maximum drawdown recorded during this period was 42.67%. This drawdown began after a peak price of $19.56 on 2022-06-02, and reached its lowest point on 2022-10-14 when the price fell to $11.21. The drawdown lasted for 134 days.

The drawdown was moderate and aligns with the type of volatility observed in many broad market assets over extended periods. The maximum drawdown lasted over three months, often seen in deeper corrections or extended periods of market stress.

The Calmar Ratio — annualized return divided by maximum drawdown — was 2.19, reflecting the tradeoff between return and volatility.

This is an excellent risk-adjusted return. A Calmar Ratio of 1.0 or higher is rare and indicates that the strategy generated strong returns relative to its worst drawdown.