Doubt: How compounding work
As'salamualikum
I'm one of your video,it is mentioned that. If one has invest 1 lakh in relaxo footwears, it would have become 78lakhs by now.
If i apply basic maths.
One will get 3703 shares of relaxo footwears with investment of 1 lakh in 2012.
In 2021, price of each share is 1170.
So total value of above share is:
3703*1170 = 42 lakhs.
So my doubt is. How it became 78 lakhs?
Similarly for other cases also.
Brother, Iam not sure which video are you referring to as the above link is not working, but if u check the values in the latest video inshallah the values will match. Basically if the word compounding is confusing you, let me clarify that it is not compounding in its actual sense as used for interest but it is compounding of investing in a manner that the investment multiples in the LT.
Jazakallah hope that clarifies.
@moneybfagmail-com
Video link: https://www.youtube.com/watch?v=mtNkbHE2Bio
Title: How to time markets ? Time: 1:06.
For relaxo footwears, one share price is 27. So if one invested 1lakh. he would have got 3703.
Now in 2021,JUL. Price of each is 1170. SO final value of all shares is 1170* 3703 = 43Lakhs. But video it is mentioned as 78 Lakh. I just want to know what is the gap between my calculation & value shown in video.