TRUST INVESTING, compound interest
In this article we are going to be talking about what compound interest is and how it applies to the Trust Investing system. Why use compound interest? What profit can it give me? What are the risks of using it?
We must first understand that Trust Investing is a company that manages our capital in the form of Bitcoin. We invest and they have hired specialists in all the best opportunity markets and they make our money grow. Of course in the process they earn a lot, but as long as I multiply my earnings, it doesn't bother me that they earn too, go ahead.
Compound interest is the sum of the interest earned to the principal amount of a loan or deposit (deposit in this case), or in other words, the interest on the interest. It is the result of reinvesting the interest, instead of withdraw it, so that the interest for the following period is calculated on the principal sum plus the previously accumulated interest. Compound interest is a standard in finance and economics. It is not my interest to make a complete description of this concept, it is something well studied and from which you can easily find information.
Simply put, it means that when interest earnings are released, rather than withdrawn, they are reinvested. When this is done, the next time interest is calculated, it will be based on the new amount invested and will increase each time.
How it's done at Trust Investing
Instead of calculating interest in long terms as in banks, for example, Trust Investing releases the earnings of each plan 30 days after the purchase of the same (one month). And it does so every month until the plan makes a profit equal to its 200% in which case it finishes its work.
When the winnings are released and put in the “Available” wallet it is time to decide what to do with that money. You can withdraw it, sell it or simply reinvest it (assuming of course that it is enough to buy a plan).
Let's take for example the purchase of a $100 plan (we use this plan again for ease with the calculations). After the month of the purchase, the earnings are released, which should be approximately $20, depending on how the businesses have behaved that month. That amount is enough to buy a $15 plan. This plan is purchased with the money earned within the same system, there is no need to enter more money.
From that moment on, the total amount invested is $115 and you still have another $5 left over that you can save or whatever you want to do with it, although initially you only put in $100 of real money. When the daily earnings are calculated from that moment on, they will be calculated for the two plans, receiving approximately $23 the following month, instead of the $20 the previous month.
The following month you do the same and will have a plan of $100 and two of $15 with $13 to spare. The earnings of the third month will be approximately $26 plus the $13 that you had accumulated, it is already enough to buy a larger plan, in this case the $30 plan and thus increase the investment.
This mechanism allows you to expand your investment exponentially and at a certain point you are having large monthly profits because you are receiving approximately 20% of each plan and you have many of them actives. All with the same starting money.
What are the risks of using compound interest?
How can such a cool concept have risks? Well, it has several, although they are actually a bit ironic, heh. In reality, the risk is that we are failing to obtain the profit generated in order to achieve more profits.
In itself this is not bad, on the contrary, it is perfect. The problem is that the time of collection of the benefits is extended, that is, we are making our investment more long-term. This is not bad either, investing for the long-term is important and smart. However, for people who are very afraid of losing their money, this may not sit well with them.
Unfortunately, there are many bad experiences with cryptocurrency investment systems on the internet due to the number of scams that have been carried out, it is true. This makes people (understandably) afraid to risk their money, or want to risk it for as little time as possible. But this is where scammers take advantage of us, they tell us that they are going to give us great benefits in a short period of time and we believe it because we are afraid of time. And that's when we really lose our money.
No system is 100% safe even if it is real, each investment is a risk and must be seen as such. As far as my experience comes, Trust Investing works and is doing well, hopefully much longer.
The other risk is much more ironic, heh. It refers to the addiction that compound interest can create. It is more serious than it seems. When you have the money almost in hand and you are analyzing what to do with it, you will realize it, heh. The idea of investing again is very imposing because it will make profits grow much more, and it is not that it is bad, it is very smart. But it is always good to draw up a strategy and follow it.
At Trust Investing, compound interest is neither mandatory nor automatic.
When the earnings are released, you can freely choose what to do with them. If your strategy is to take the profit and receive only 200% of the investment, that is fine. If you do compound interest, you spread the investment a little more to earn more, that's fine too. If you want to extend it for just a short time or extend it for years, that's fine too. It is a matter of drawing your strategy and following it.
This is just one in a series of articles about the Trust Investing investment system. If you are interested, I invite you to also read the rest of them from my user.
Other articles in this same series:
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