The impact of compounding is important and investors must have basic knowledge of this concept to assess the returns from various instruments. Yet an online survey conducted by ET Wealth last month shows that two out of five respondents don't know how compounding works. If a bank offers 8% interest compounded quarterly (or 2% per quarter) on its 10-year deposit, an investment of Rs 1 lakh will grow to Rs 2.2 lakh in 10 years.
Over 20% Return in 6 Months! Are Gold Mutual Funds The Right Investment Option?
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