Stange question about compounding interest

Discussion in 'Professional Trading' started by lasner, Sep 25, 2011.

  1. lasner


    Is a 900% return the same as a 30% return for 30 years. It's the same amount right it equals 900%. 30% for 30 years.

    Will you get the same return if you make a 900% in 1 year as you would with a 30 year 30% return each year.
  2. lasner


    The answer that I get is no. I turned $368 into $7,000. That's a 2,000 percent return. If I had made a 2,000 percent return over 30 years at 60% per year it would have turned into 2 billion bucks!

    Compounding interest SUCKS!!!!!!! I WANT MY 2 BILLION DOLLARS, I've been cheated by compounding interest!
  3. Not sure where you get 2 billion since $768 compounded at 30% annually is about 2 million dollars.
    It's not an "apples-to-apples" comparison, anyway.
  4. lasner


  5. Maverick74


  6. ~2 bill.
    Incidentally, there's a simple equation to get the results.
    368*(1+.6)^33 ~ 2e9

    30yrs would get you to around 1/2 bil (as long as we're dreaming).


  7. heech


    I ended up with $2 billion as well.

    1.6^33 = 5,444,517. So, you'll multiply your starting value by 5 million.

    In any case... this is a really silly thread.
  8. Maverick74


    Where are you getting 60% from? He is using 30% per year.
  9. Maverick74


    You can do the math in your head in 10 seconds using the rule of 72.
  10. I just used this post....
    Granted, from post to post, there's very little consistency in his numbers.
    #10     Sep 25, 2011