26 December, 2013

1-5-16 finance: Compounding = Accumulation

The accumulation of financial gains over a certain period of time. This is a very good strategy to make a lot of money in relatively a short period

-          You invest some money, you gain, you reinvest the gains …. Etc.
-          This is like the snow ball effect

-          The best thing about compounding is that it doesn’t have to be a lot at all
The only 2 factors in that are:

1-     How much of gain in 1 time periods?
2-     How many time periods do you have?
For example; if you improve by 1% a day, you will be twice as good in 70 days :)