Invested Capital, Time and the Rate of Return play important role in wealth compounding.
We should work & save for the capital, identify good companies, buy them cheap, and be patient.
The Stock Market is designed to transfer money from the Active to the Patient. - Warren Buffett
Investing should be more like watching paint dry or watching grass grow. - Paul Samuelson
No matter how great the talent or efforts, some things just take time. You can't produce a baby in one month by getting nine women pregnant. - Warren Buffett
Time is the friend of the wonderful company, the enemy of the mediocre. - Warren Buffett
the 3rd scenario is a bit unrealistic, with RM 100 bil , you wont be able to continue making 60% p.a. as the capital has grown too big... In fact I think 15% is already a very difficult task if we re talking about a 30 year time frame...
The computational in theory are correct. However, when taking into account of realism, you may not be making consistent returns for the next 30 years. Some years you may make loss or some years you may make significant returns. Besides, the computation shows that the investor did not take a single cent out of the fund which i think would be impossible when you have few millions in your fund.
those put compound interest to practice is one of the rarest investors.legendary investor warren buffett is obsessed with the idea of compounding and his two most profitable portfolio are result of this obsession.
It is a norm that 80% volume come from penny stock trading. The promise of big gains is why investors dabble in penny stock in the first place, leaving only a handful long terms investors. Even for the most committed long term investors, compounding is a monumental task to achieve. Compound investor is a rare breed indeed.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
Intelligent Investor
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Posted by Intelligent Investor > 2015-01-23 14:43 | Report Abuse
Invested Capital, Time and the Rate of Return play important role in wealth compounding.
We should work & save for the capital, identify good companies, buy them cheap, and be patient.
The Stock Market is designed to transfer money from the Active to the Patient. - Warren Buffett
Investing should be more like watching paint dry or watching grass grow. - Paul Samuelson
No matter how great the talent or efforts, some things just take time. You can't produce a baby in one month by getting nine women pregnant. - Warren Buffett
Time is the friend of the wonderful company, the enemy of the mediocre. - Warren Buffett