Learn to double your money and the sky will be the limit. If you are able to double your initial capital once, you will be able to do the same thing several times. There is no doubt in my mind that any man in the world can become a wealthy individual, but first you need to understand…
#1. – The power of compound interest
I want to share with you one secret, that rich people rely on, and will make all the difference in the world if you want to double your money.
Albert Einstein said: “The most powerful force in the Universe is compound interest”.
Many people underestimate the power of compound interest when making their investing decisions. Small gains tend to add up very quickly when you invest your money wisely. If you move your money in a responsible disciplined manner in no time you are going to have a small fortune.
There are two parts of the compound interest formula that will affect the amount of return you will make on your initial investment.
1. Time: for how long your money will be working for you?
2. Interest rate: How much profit will you make on your initial investment, per period?
With the low rates that banks have to offer many people get discouraged to realize they need many years to double their money. The good news is that you can use the stock market to increase significantly the return rate and cut your waiting time a lot. But you need…
#2. – A positive expectancy system.
To trade safely in the stock market you need a positive expectancy system.
Positive expectancy means that, based on past performance, you can realistically expect your system to win more money than the money it loses.
The whole gambling industry is based on this premise. The odds are always in favor of the house. The casino knows, and expects, the occasional drawdown. They don’t mind when a gambler gets lucky and wins some money; in the long run they will gain all their money back with some profit.
With a good positive expectancy system you can lose 9 out of 10 trades and still make a lot of money. You could realistically earn 10%, 20% or even 100% of your money in a short period of time.
#3. – Invest don’t gamble.
Of course you could double your money in 5 minutes in roulette. But, that is not a wise investment decision. Remember, we are not gambling. You need discipline to become wealthy.