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This feels like a semantics back and forth. Call it compound growth then. It's the same concept. This applies to all yielding assets. You can call it divs / buy
by awrence 7y ago
This feels like a semantics back and forth. Call it compound growth then. It's the same concept. This applies to all yielding assets. You can call it divs / buybacks for stocks and interest for bonds, but it's the same thing / effect.
- samatman 7y agoNot even vaguely. Compounded interest is reliable, even boring. You know exactly what you'll have at any moment in time. Your ten-year index returns are reasonably reliable, historically. But your 2007-2009 returns aren't your 2016-2018 returns, at all. They're different concepts and deserve to be conceptualized differently, especially in the modern era, where interest rates on Treasure are lower than inflation.