We all want to get rich. And if you want to
trade for a living then you better be making money and having it grow.
So what’s the secret? It is a very simple concept. You use a trading
system that has a positive expectation (see
expectancy), give it time and then compound the profits. With most
trading methods, you will not get rich overnight. And if any of you
out there in trader-land know of an overnight, get rich system … you
would not be reading this. But really, given enough time, you will
make money and get rich. Trading does require patience. If you have
the discipline to work with your system, you will making money.
Compounding
money has what is called a “snowball effect”. As your money rolls down
the hill it becomes bigger and bigger. Even if you start with a small
amount of money or snowball, given enough time, you can end up with an
extremely large snowball indeed.
Time and compounding your money will make
you rich - if you stick with your system. If you can manage to make
50% a year in your trading, you can grow an initial $10,000 account to
over $170,000 in just seven years. Check the below chart for other
percentage return of investments.
10%
20%
30%
40%
50%
Year 1
$11,000
$12,000
$13,000
$14,000
$15,000
Year 2
$12,100
$14,400
$16,900
$19,600
$22,500
Year 3
$13,310
$17,280
$21,970
$27,440
$33,750
Year 4
$14,641
$20,736
$28,561
$38,416
$50,625
Year 5
$16,105
$24,883
$27,129
$53,782
$75,937
Year 6
$17,715
$29,859
$48,268
$75,295
$113,906
Year 7
$19,487
$35,831
$62,748
$105,413
$170,859
$10,000 Annual Return Using
Simple Compound Interest
I have included a
compound interest calculator so that you can determine other rates
of return.
