“The day I discovered compound interest I changed interest for ROIS” CAPS As we stop dreaming in exchange for living, we will really achieve our goals, and I mention this because we live in a country with limiting multi-beliefs and because of the overflowing ambition of going for the easiest way without taking into account the balance of the outlined diversification.
In the constant search for generating equity profitability, I have experience in instruments, investments, capital markets, derivatives, futures and business, in short, there are many options in banks, brokerage firms, sofomes, companies in which you can put your money to generate interest, returns, profits, dividends; but before investing, the regulation by law, the CNBV (National Banking and Securities Commission) recommends profiling, that is, what level of investor am I? Where should I start? In short, PROFILING is nothing more than a diagnosis before investing and this is linked to the level of risk you could face, knowing that you can earn above average but you can also lose.
Profiling diagnoses can result in Conservative 10 percent Risk, Moderate 20 percent Risk, Patrimonial 30/50 percent Risk, Aggressive 50/70 percent Risk and 100 percent Sophisticated High Risk.
The percentage of your portfolio in the risk part for a positive result is linked much more by fundamental analysis than technical analysis and this is due to the evolution of the economy in the world. Before there was a crisis every 10 years a “cloud” was formed. Now we have had 3 crises in less than 10 years, such as Brexit, Pandemics, the war between Russia and Ukraine, the thing with Israel, and what to say about government policies, as well as the 80 current conflicts in the world.
Now, if you allow me, I will suggest, without much analysis, how to achieve your goals by leaving aside the generation of interest through ROIS. In Lebanese or Jewish culture, it is often said that 10 percent of your income should be invested in a savings and investment strategy. I wish that in Mexico there were subjects and promotions starting in primary schools, but that is not the case.
The ROIS proposal in the fund does not require as much risk or as much analysis, simply save or invest in conservative instruments, but using COMPOUND INTEREST + MONTHLY INCREASES, this system is an accelerator mechanism, that is, in the traditional way you would reach your goals in 10 or 15 years, in this one in 3 to 5 years depending on how consistent you are.
The magic is in the combination of COMPOUND INTEREST and the consistency of increasing surpluses each month, the function and objective of ROIS is how many times you can multiply your initial investment or return but also an accumulation of the target capital.
The ROI formula INVESTMENT=INITIAL INVESTMENT-INVESTMENT/INVESTMENT. And do you want to work for money or do you want money to work for you? Carlos Peña Master in Financial Administration (EDEC).
He is CEO of Open Opportunities Consulting Group, certified financial advisor and coach, and speaker.
How can I effectively use compound interest to achieve my financial goals?
Table of Contents
The Power of Compound Interest: Achieving Financial Goals through ROIS
As we transition from dreaming to living, we often come to realize that our goals require a solid plan and dedication to achieve. In a country where diversity and ambition can sometimes lead to imbalance, it’s essential to focus on the right strategies to secure our financial futures. One crucial concept that can help us get there is compound interest, an often-underestimated tool that can accelerate our progress towards financial success.
Understanding Compound Interest
Compound interest is the concept of earning interest on both the principal amount and any accrued interest over time. This snowball effect can lead to substantial growth in our investments, making it an attractive option for those seeking long-term financial stability. By harnessing the power of compound interest, we can turn our savings into a lucrative instrument for achieving our goals.
The Importance of Profiling
Before diving into investments, it’s crucial to understand the level of risk we’re willing to take on. The National Banking and Securities Commission (CNBV) recommends profiling, a diagnostic tool that helps investors determine their risk tolerance. By understanding our risk profile, we can make informed decisions about where to invest our money and avoid potential pitfalls.
Profiles can be categorized into several risk levels, including:
Conservative (10% risk): Suitable for those who prioritize stability over potential returns.
Moderate (20% risk): A balanced approach for investors seeking moderate growth.
Patrimonial (30/50% risk): Ideal for those seeking consistent returns while accepting some level of risk.
Aggressive (50/70% risk): For investors willing to take on higher risks for potentially higher returns.
* Sophisticated High Risk (100% risk): Reserved for experienced investors who understand the risks and rewards associated with high-risk investments.
Fundamental Analysis vs. Technical Analysis
When it comes to investing, fundamental analysis focuses on understanding the underlying economic factors that drive growth, whereas technical analysis relies on charts and patterns to predict market trends. In today’s fast-paced global economy, fundamental analysis plays a more significant role in achieving positive results.
Achieving Financial Goals through ROIS
In many cultures, including Lebanese and Jewish traditions, it’s common to allocate 10% of one’s income towards savings and investments. Unfortunately, this practice is not widely encouraged in Mexico. However, by adopting a similar approach and leveraging compound interest, we can accelerate our progress towards achieving our financial goals.
ROIS (Return on Investment Strategy) offers an attractive alternative to traditional investment methods. By investing in conservative instruments and utilizing compound interest, we can reach our goals in as little as 3 to 5 years, depending on our consistency and commitment.
Conclusion
compound interest is a powerful tool that can help us achieve our financial goals through ROIS. By understanding our risk profile, adopting a fundamentals-based approach, and leveraging the power of compound interest, we can accelerate our progress towards financial success. As we strive to make our dreams a reality, it’s essential to prioritize financial literacy, discipline, and patience. By doing so, we can overcome the limitations of our multi-belief systems and achieve our goals, no matter how ambitious they may seem.
Keywords: Compound Interest, ROIS, Financial Goals, Profiling, Risk Tolerance, Fundamental Analysis, Technical Analysis, Savings, Investments, Financial Literacy.
Financial foundation. Understanding the power of compound interest can be a game-changer in reaching those ambitions.
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How Can I Effectively Use Compound Interest to Achieve My Financial Goals?
As we transition from dreaming to living, we often come to realize that our goals require a solid
