In: Finance
If average stock portfolio would yield 3.7% per annum then how much time would it take for a portfolio to increase 3 times in value if all profits are reinvested?
Suppose investment amount is: 100
Yield: 3.7%
Future value = Original principal × (1 + Simple interest rate) Number of periods
300=100 (1+0.037)n
n = 30.25 years or 30 years and 3 month (appx.)
30 years and 3 month takes portfolio to increase 3 times