|
|
Compound interest |
|
|
|
 Home Site Map Add Term Search About Us Contributors |
Compound interestInterest paid on previously earned interest as well as on the principal.Compound interestThe interest paid on the principal balance in a mortgage and on the accrued and unpaid interest of the loan.Compound interestThe process by which interest earned on an investment is added back to the amount invested, so increasing the amount of 'principal' on which further interest will be earned in future years.Compounding is sometimes described as the miracle of investing. The fact is that if you reinvest income in your portfolio, you will end up with a much larger amount than if you spend the income as you go along because of the effect of compounding. But to allow compounding to work its magic, you have to start young.Albert Einstein, when asked what he considered to be mankind's greatest invention, replied 'Compound interest!'Similar MatchesCompound optionCompound optionOption on an option. Compound annual growth rateCompound annual growth rateThe average rate at which a particular financial parameter compounds up over a period of years. Compound tariffCompound tariffA tariff that combines both a specific and an ad valorem component. Continuous compoundingContinuous compoundingThe process of accumulating the time value of money forward in time on a continuous, or instantaneous, basis. Interest is earned constantly, and at each instant, the interest that accrues immediately begins earning interest on itself. Compound Annual ReturnCompound Annual ReturnSee: Compound Annual Growth Rate Further SuggestionsRealized compound yieldcompound reversionary bonus Simple compound growth method Discrete compounding Compound growth rate Compounding Compounding period Compounding frequency Compound Annual Growth Rate |
|
|
|