My Trading Adventure

Slow and steady

CP TEH
Publish date: Sat, 28 Feb 2015, 09:53 AM
CP TEH
0 2,918
All the writings in this weblog are mainly for PLEASURE reading purposes. I am in NO position to recommend a call(BUY/SELL). Please check with those know-hows before you make a decision. Yes, I am just a learner, with only five years experiences in KLSE. So, please BEAR with me.

Compound Interest

of 10%

RM10,000 --- RM11,000

RM11,000 --- RM12,100

RM12,100 --- RM13,310

RM13,310 --- RM14,641

RM14, 641 --- RM16,105.10

So ... after FIVE time-period, our RM10,000 becoming RM16,105 which is about 61% increase.

of 20%

RM10,000 --- RM12,000

RM12,000 --- RM14,400

RM14,400 --- RM15,840

RM15,840 --- RM19,008

RM19,008 --- RM22,809.6

So ... after FIVE time-period, our RM10,000 has doubled (more).

This is what I meant by being patient ... trade well, gain about 10-20% per year. In five years time, our capital will be doubled.

What if we could gain 50%?

RM10,000 --- RM15,000

RM15,000 --- RM22,500

RM22,500 --- RM33,750

RM33,750 --- RM50,625

RM50,625 --- RM75,937.5

There you are ... RM10,000 becoming RM76,000

Understanding compound interest is just a very basic about increasing our financial mindset. Then, we could understand why we should NOT buy using credit-card (and paying the minimum) ... and we should not put our money in banks(only 3% per annum).

Stock market is still a good place to invest-trade. But, majority are greedy and want to get-rich-quick ... by buying into Destini and such.

THINK and reflect for the weekend. Perhaps, time to change our strategies?

Have a nice weekend.

TEH
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Discussions
1 person likes this. Showing 3 of 3 comments

sentimentrader

If onlu the world n market is so perfect..sorry but its very low chance.

2015-02-28 12:19

sentimentrader

This can only be use by insurance agents to paint a very good picture of only 8 percent per annually...yet they cannt achieve ...

2015-02-28 12:21

Kevin Wong

The longer one invest, the more difficult it is to get above average market returns. The most successful investor Buffett, achieved a 20% p.a. increase of capital over 50 years, while the S&P 500 only added about 10% over the same period.
In the case of the KLCi, since 1995 the index has only put on just around 80%[not including dividends]...so realistically...
50% p.a. over 3 years possible, only if very lucky and/or take on huge risk!

2015-02-28 21:55

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