The Power of Compounding: Understanding its Impact on Stock Market Investments
The power of compounding is one of the most powerful and potent concepts when it comes to wealth building and finance. Compounding is the process of earning interest on interest, where the returns on an investment are reinvested to generate even more returns over the time. The longer the investment time, the more powerful the impact of compounding. Let’s take a look at how compounding works in the stock market. How Compounding Works with an Example: Suppose you invest $1,000 …