99% of Buffett’s wealth was earned after his 50th birthday

Multibaggers.co.in
Sep 4, 2018 · 2 min read

Warren Buffett one of the most successful investors in the world has a net worth of US $84 billion as of June 3, 2018, making him the third wealthiest person in the world.

99% of Buffett’s wealth was earned after his 50th birthday.Each passing year is multiplying the wealth of Warren buffet by leaps and bounds. Even if he does nothing, his wealth will keep multiplying.

How this is happening?? Which force is acting behind it??

Compound Interest !!!!

Compound interest is interest earned on interest. The act of declaring interest to be principal is called compounding. Compounding always looks slow at the beginning. Look at this curve and think at the negative part as before 50.

DO YOU KNOW INVESTMENT IN EQUITIES GIVE COMPOUNDED RETURNS?

If you have invested 10k in stock, and it goes up 20% in a given year, you have made 2k. If it goes up 20% again the next year, you won’t make another 2k, rather you’ll make 2.4k, because you’re now working with 12k amount, not 10k. And if your stock continues to return 20% each year, your gain will continue to grow exponentially larger, even if you’ve never added any additional principal. That, in addition to the dividend thing, is how compounding works with stocks. So know the Long term stocks to buy and invest in best stocks to get the benefit of compounding.

Proper stocks and Proper price both are equally important. Warren buffet use to work on funda of value investing that is investing in fundamentally strong stocks that are undervalued as it gives higher margin ofsafety.

Other asset classes also give us compounded returns, but equity asset classes goes ahead of all. It is an extreme case of compounding since most interest is compounded on a monthly, quarterly or semiannual basis. But equity provide continues compounding. In continuous compounding, interest is calculated and added to the account’s balance every infinitely small instant. So benefit rises even more.

These magical returns come with passage of time.Change your fortune by long term investment in stock market through experts.For clarification or detailed information contact us

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