How the Hell do You Make a Million Dollars with 2% Compounded?!

I was watching a video with Anton Kreil (you may know him from the fun watch Million Dollar Traders). Getting straight to the point he mentioned in his seminar:

If you start a trading account with $10,000 leveraged up to $40,000 - you make 2% trading a month, compounded. By 2/3's of year 7, you will hit $1,000,000

I've done the math a million times. 8 Year is 96 months. At END of year 8, you will only have $262,467.97. Compounded monthly.

Bascially I took $40,000 and compounded it 96 times at 2%.

Am I missing something here?! Did he mean 5%?? If it's 5%, I can hit $1M halfway through my 5th year. Maybe I am making a mistake somwhere....

 

The leverage is 4-fold means the return per month (all things being equal) is 8% on original. So after 5 years (60 months) you should have 10000 X 1.08 ^ 60 = 1,012,000. More than a million. Of course no withdrawals or taxes, and steady returns.

 

Best advice I can give, is don't worry about it and stop thinking about the quick path to millions.

 

8 Years for 1 Million is hardly "quick path to millions".

 

I get 267k but I think what he means is by year 8 you will have a million dollars in leverage to trade which is close to 267k times 4.

 

Indeed, better to think about how to survive. If you can make money you will notice it when you arrive at 1 million.

 

Most Americans will even never make it in a lifetime. For them it is still a quick path.

 

I'm bad at math too, I got C's basically in that subject area. (i'm not a left brain person at all) -- but all I know is Compounding is a powerful, explosive thing.
needing to know exact numbers aren't necessary in trading, but more of the general idea and philosophy. -- and everything else will kind of take care of themselves.

 

Yes, that's the lesson from the video. Once you are able to do the math, you will make the money. If only more people were able to extrapolate their fortunes from their better days.

 

This is incorrect. That isn't how compounding works and is valid only for the first month: compounding 8% per month on an original $10,000 and compounding 2% per month on an original $40,000 are two hugely different things.

I suspect that possibly both Anton Kreil and yourself haven't quite appreciated this.

Nope. Your math is apparently better than Mr. Kreil's (but what he says isn't atypical of the wildly irrelevant and ludicrous claims typically made by vendors).