The 8th Wonder of the World
Albert Einstein called compounding the 8th wonder of the world. In trading, compounding is not just about interest; it is about the "Power of Reinvesting Profits." If you can manage a 1% daily return, the results after a few years will shock you.
The Math Behind the Magic
If you start with ₹1 Lakh and earn just 0.5% profit daily, you are not just making ₹500. After 250 trading days, your capital would have grown significantly. The key is to **Never Lose Your Capital**.
The Dangers of Compounding Downwards
Just as compounding works for you, it can work against you. A 50% loss requires a 100% gain just to get back to break-even. This is why "Capital Preservation" is the most important rule in our community.