The meaning of compound interest is extraordinary. As we all know, Buffett, the god of investment, is not particularly prominent in his annual return on investment, but because he 10 has maintained a relatively stable level of return on investment, his investment has achieved amazing results under the effect of compound interest. Compound interest is like acceleration, which is not obvious at first, but with the accumulation of time, your investment curve can be steeper and steeper. Therefore, we all hope that our investment is an investment with compound interest effect.
Bank deposits usually have no compound interest effect. For example, if you deposit a three-year deposit, the principal used to calculate interest will not change for three years. The interest it generates every year is only recorded in the account and will not generate income as the principal. If you want to achieve the compound interest effect through bank deposit, you have to manually take it out and deposit it after each maturity. Bond products are often designed to pay interest every year, and then pay the interest before buying bonds. In this case, he has some compound interest attribute.
The simplest way to realize compound interest operation is to invest in stocks. After each stage, you can reinvest your investment profits. Here is a 72 rule. Just divide 72 by your rate of return every time, and you get the time needed to double it. For example, your account has a daily limit today, and the yield is 10%. If the principal is 654.38 million yuan, it becomes 1 10000 yuan. The next day, you will invest this 1 10000 yuan. If the daily limit can go up again, it will become 12 10000 yuan. By analogy, if the yield of 10% is divided by 72, it will take 7.2 days, which means it can be doubled on the eighth day.