Tuesday, February 8, 2011

$100 to $10,000

Here's an interesting fact I just learned while making my video series:

To grow $100 to $10,000 will approximately take 52 weeks--compounding your bankroll each week by 10%! I'm not good at math, but 10% of a $100 bankroll is $10, isn't it? Playing at 5NL, that's approximately 2 buy-ins (at 100bb per buy in). This means that each time I move up a stake level, I only need to profit 2 buy-ins each week CONSISTENTLY, moving up a stake level when my bankroll allows it (15bi/stake level). After one year (52 weeks), I'd have my $10,000!

Do the math yourself. Here is the link to the future value calculator that I used:

http://www.investopedia.com/calculator/FVCal.aspx

Where:
Interest rate per time period is 10%
Number of time periods = 52
Present value = 100

Hit the calculate button and you will get a Future Value of $14,204.29, plus this explanation below it:
If today you were to invest $100.00 at a rate of 10%, you would have $14,204.29 at the end of 52 time periods (e.g. weeks, months, or years). In other words, a future value of $14,204.29 is equal to a present value of only $100.00.

Realists will say it's not entirely possible as you have a number of factors to consider. Variance is one.

I'm not going to argue with anyone on that. If Christopher Columbus were to win every argument that was presented to him, he wouldn't have discovered penicillin ;p

Follow my series on youtube (or this blog) and we'll see if this theory holds out.