Originally Posted by cameronj
No clue where you got those numbers from. I simply created a spreadsheet with 1 at the top and the second row = A1*1.01, and copied that down 250 times (to account for 5 days a week instead of 7). How you ended up with only 1/3 of the gain I did I am totally unaware. Let me know how you came to the 1% gain number like you did.
By your logic even a 0.1% gain is an unsustainable SOAR because nothing can grow at any exponential rate, no matter how small, forever.
What you did in excel is not compound interest...
Compound interest is calculated by :
value = Principle*(1 +rate)^interval#
This isn't fair because a bank would not do this but you argue you can't trade on saturday so whatever. With 250 days per year not 356 which I did.
value = 1000*(1.02)^250 = $141267.72
0.5% interest on 1000 dollars equals $3479.49 in value after 1 year. 248% apr AAPL stock price would be 2366.05
1.0% interest on 1000 dollars equals $12032.16 in value after 1 year. 1103% apr AAPL stock price would be 8181.87
2.0% interest on 1000 dollars equals $141267.72 in value after 1 year. 14126.772% AAPL stock price would be 96062
THERE IS NO LOGIC HERE. By MATH 0.1% gain compounded daily equals a 28.3% annual return but still WAY better than the rest of the market. Compound interest is amazingly powerful.
Feel educated, not dissed.