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could this be possible after 20 yrs of investing from NSE
Rank: Veteran Joined: 8/11/2010 Posts: 1,011 Location: nairobi
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Assuming you have 1.5M to invest in NSE for 20 yrs from now with the returns each year plough back with yearly target of 30% return.
Year 1) 1.5m of 30%=1.95m inclusive of returns.ior
Yr 2) 1.95m of 0.3 = 2.53m ior
yr3) 2.53m of .3 = 3.29m ior
yr4)3.29m of .3 = 4.28m ior
yr5)4.28m of .3 =5.56m ior
yr6)5.56m of .3 =7.2m ior
yr7)7.2m of .3 = 9.45m ior
yr8)9.45m of .3 = 12.2m ior
yr9)12.2m of .3= 15.9m ior
yr10) 15.9m of .3 = 20m ior
yr11) 20m of .3 = 26.9m ior
yr12) 26.9m of .3 = 35.08m ior
yr13)35.08m of .3 = 45.5m ior
yr14)45.5m of .3 = 59m ior
yr15) 59m of .3 = 76.7m ior
yr16) 76.7m of .3 = 99.7m ior
yr17) 99.7m of .3 = 129.6m ior
yr18)129.6m of .3 = 168m ior
yr19)168m of .3 = 218m ior
yr 20) 218m of .3 = 283.56m
above exclude broker commissions which can be calculated as 3trades per year multiplied by 2 multiplied by 1.8% of approx 200m.= 21m
net comes to no less than 260m and i take early retirement with a hse in kitusuru
who sayslife ni ngumu ukijipanga.
Regards
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Rank: Veteran Joined: 8/30/2007 Posts: 1,558 Location: Nairobi
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yes...the magic of compounding...one thing I must say is, you will have off years and the bigger the sum, the harder it is to keep compounding at hose big rates...
U have been reading "Buffetology" havent u?
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Rank: Elder Joined: 9/25/2009 Posts: 4,534 Location: Windhoek/Nairobbery
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@Bartum in your 36% year on year return u didnt factor in things like droughts, bears, recessions n the political risk...there will years on the NSE during that period when breaking even will be impossible...remember 2007-2008...the market is cyclical my brother...
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Rank: Veteran Joined: 8/11/2010 Posts: 1,011 Location: nairobi
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Horton wrote:yes...the magic of compounding...one thing I must say is, you will have off years and the bigger the sum, the harder it is to keep compounding at hose big rates...
U have been reading "Buffetology" havent u? who told you to read my mind. Any way nse creates riches
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Rank: Member Joined: 5/28/2010 Posts: 151
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Compound Interest Calculator:- Inputs Current Principal: ksh.1,500,000 Annual Addition: ksh 0.00 Years to grow: 20 years Interest Rate: 30% Compound interest 1 time(s) annually Make additions at start of each compounding period. Results Future Value:Ksh. 285,074,456.62 Ni Uhuru wa Mbesha...Niguo kana tiguo?
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Rank: Veteran Joined: 8/11/2010 Posts: 1,011 Location: nairobi
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the deal wrote:@Bartum in your 36% year on year return u didnt factor in things like droughts, bears, recessions n the political risk...there will years on the NSE during that period when breaking even will be impossible...remember 2007-2008...the market is cyclical my brother... if i make -ve returns in some years is it not posssible to make above 50% in some yrs to compensate. Just my thoughts
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Rank: Elder Joined: 9/25/2009 Posts: 4,534 Location: Windhoek/Nairobbery
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bartum wrote:the deal wrote:@Bartum in your 36% year on year return u didnt factor in things like droughts, bears, recessions n the political risk...there will years on the NSE during that period when breaking even will be impossible...remember 2007-2008...the market is cyclical my brother... if i make -ve returns in some years is it not posssible to make above 50% in some yrs to compensate. Just my thoughts i'm not saying that's not possible...that brings me to another thing company risk..look at EA Cable a one time Blue chip...do u think in 10-15 yrs time we will see Cables at 140 again...then theres market psychology i.e ur nerves...unless u quit wazua n go to a shambaa somewhere the urge to trade will be there...i have realised what those American investment books tell us doesnt work on the NSE a market of inside traders...
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Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi
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the deal wrote: unless u quit wazua n go to a shambaa somewhere the urge to trade will be there...i have realised what those American investment books tell us doesnt work on the NSE a market of inside traders... This is soooo true... i never thought i would sell KPLC but damn i actually traded it when the info came out... By the way compounding is a very sound strategy that i'm very fond of using but i never speculate while compounding... EVER Mark 12:29
Deuteronomy 4:16
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Rank: Chief Joined: 3/24/2010 Posts: 6,779 Location: Black Africa
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Weka 1.5 equity ama kcb. Bila shaka utapata 260 yako. The power of compounding! GOD BLESS YOUR LIFE
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Rank: Veteran Joined: 7/24/2008 Posts: 781
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hata ukiwa na all the insider info hauwezi average 30%....20% is more like it. The utimate goal of investing is to buy low sell high;if we re-write this core equation in psychology terms it becomes buy fear sell greed.
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Rank: Veteran Joined: 10/11/2009 Posts: 1,223
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Damn it! i hate insider trading but it is the norm @ NSE. Last week alone equity traded extraordinary volumes @ 26.75-27.00 my gut tells me iko kitu insiders wanajua but not in the public domain. Any way such uneven playing ground calls for swiftness if you have to make money at the nse. where did yasser big chair disappear to? History will not remember you for your IQ. It will remember you for what you did. “Genius is 1 percent inspiration, 99 percent perspiration.” Thomas Edison
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Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi
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BGL wrote:Damn it! i hate insider trading but it is the norm @ NSE. Last week alone equity traded extraordinary volumes @ 26.75-27.00 my gut tells me iko kitu insiders wanajua but not in the public domain.
Any way such uneven playing ground calls for swiftness if you have to make money at the nse.
@BGL not only equity but don't you see how stocks on the NSE trade before resluts come out... if the results are good the stock starts rallying a whole two weeks before they are released to the public and the same happens when they a re bad.... i think we all remember @Njun'ge quoting for us on wazua Mumias exact results a week and a half before they were released...  Mark 12:29
Deuteronomy 4:16
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Rank: Veteran Joined: 7/24/2008 Posts: 781
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I remember JM taking opportunity of a loophole(split 1:10) to sell some of his holdings at 17bob using chase bank...meanwhile the rest of us could only sell 10%!!!! after he sold the thing dropped to 9.50....I pity those who bought at 17....shame on CMA for allowing things like this to happen. The utimate goal of investing is to buy low sell high;if we re-write this core equation in psychology terms it becomes buy fear sell greed.
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Rank: Elder Joined: 2/10/2007 Posts: 1,587
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the deal wrote:@Bartum in your 36% year on year return u didnt factor in things like droughts, bears, recessions n the political risk...there will years on the NSE during that period when breaking even will be impossible...remember 2007-2008...the market is cyclical my brother... Also you have to be careful at what point in time you enter NSE. Take case of 3 years ago when one bought CFC at 800, KQ at 130, Barclays at 100. I am sure you will have to struggle very hard to achieve such results. See the quote from WB below: "I learned from Ben Graham how to avoid ever having any disasters in investments. He also taught me to see a stock not as something with a ticker symbol that wiggles around but to think about it as part of a business. Don't get elated because something had gone up or depressed because it went down. If I knew the facts, and it went down, I bought more of it. He also taught me that famous lesson about a margin of safety, that you don't drive a truck that weighs 9,900 pounds across a bridge that says "Limit 10,000 pounds" because you can't be that sure. If you see something like that, go a little further down the road and find one that says, "Limit 20,000 pounds." That's one you drive across. Always think margin of safety.
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Rank: Veteran Joined: 6/2/2010 Posts: 1,069
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Bartum, I hate to be the one to burst your bubble. 36% year on year for 20 years is WAY WAY WAY TOO OPTIMISTIC!!! Even Buffet has never managed this.
But yes, compound interest is great. Einstein called it 'the most porwerful force in the universe'
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Rank: Elder Joined: 12/9/2009 Posts: 6,592 Location: Nairobi
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Just think about it, you expect your investment to grow by about 20,000% in 20years? 
BBI will solve it :)
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Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi
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2012 wrote:Just think about it, you expect your investment to grow by about 20,000% in 20years? this is very possible because it won't neccessarily take you 1 year to make 30%.. it can take a week and it could be 100% so i agree with this strategy though its not guaranteed Mark 12:29
Deuteronomy 4:16
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Rank: Elder Joined: 2/7/2007 Posts: 11,935 Location: Nairobi
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I have one lot of a blue chip which i invested mid 1990.For every bob then,i have 8000 today.NB..Dividends not (Never) re-invested.... Nothing great was ever achieved without enthusiasm.
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Rank: Veteran Joined: 6/2/2010 Posts: 1,069
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Njung'e wrote:I have one lot of a blue chip which i invested mid 1990.For every bob then,i have 8000 today.NB..Dividends not (Never) re-invested.... Wow. Which blue chip is this? EABL?
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Rank: Elder Joined: 6/27/2008 Posts: 4,114
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True; for every one shilling invested today, you will have sh190 in 20 years at an average 30%pa return. If you factor in inflation at say 5% over the same period, the true value of your sh190 comes down to sh87. In other words, the sh285m that you will have in the year 2030 will only be able top buy what sh130m can buy today.... still not bad. Nothing is real unless it can be named; nothing has value unless it can be sold; money is worthless unless you spend it.
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could this be possible after 20 yrs of investing from NSE
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