PosSize
Growth · Long-term

Compound Interest Calculator

Visualize how your trading account grows over time with consistent monthly returns.

01 — Parameters
$
Initial account balance
%
Average monthly % gain
mo
Max 120 months (10 years)
$
Additional monthly deposit (optional)
Final Balance
$17,959
Total Invested
$10,000
Total Gains
$7,959
Total Return
79.6%
Monthly Growth
Month 1Month 12
Monthly Breakdown
MonthBalanceInvestedGains
1$10,500$10,000$500
2$11,025$10,000$1,025
3$11,576$10,000$1,576
4$12,155$10,000$2,155
5$12,763$10,000$2,763
6$13,401$10,000$3,401
7$14,071$10,000$4,071
8$14,775$10,000$4,775
9$15,513$10,000$5,513
10$16,289$10,000$6,289
11$17,103$10,000$7,103
12$17,959$10,000$7,959

What is the Compound Interest Calculator?

A compound interest calculator shows how a trading account or investment grows when returns are reinvested period after period. Because each period earns a return on the previous period's gains, growth accelerates over time — the effect Einstein supposedly called the eighth wonder of the world.

For traders, this tool reframes performance: a modest, repeatable monthly return compounded over years often beats chasing occasional big wins. It makes the long-term cost of drawdowns and the power of consistency visible.

How to use it

  1. 01Enter your starting capital — the principal you begin with.
  2. 02Enter your expected return rate per period (for example, a monthly percentage).
  3. 03Enter the number of periods you want to project forward.
  4. 04Read the projected ending balance and total growth from compounding.

The formula

Future Value = Principal × (1 + Rate)^Periods

Rate and Periods must use the same unit — a monthly rate with a number of months, for example.

Worked example

Start with $10,000 and earn a steady 3% per month for 24 months.

Future Value = $10,000 × (1.03)^24 ≈ $20,328.

Reinvesting that 3% roughly doubles the account in two years — far more than 3% × 24 = 72% of simple, non-compounded growth.

Frequently asked questions

What is compound interest?+

Compound interest is interest calculated on both the original principal and the accumulated interest from previous periods. Reinvested returns themselves start earning returns, which makes a balance grow faster over time than simple interest.

Is a high monthly return realistic for trading?+

Be conservative. Sustained monthly returns above a few percent are very difficult to maintain. Use modest, realistic rates when projecting — overestimating compounding leads to dangerous expectations.

How does compounding interact with drawdowns?+

Losses compound too. A 50% loss requires a 100% gain to recover, so protecting capital matters as much as growing it. Smooth, consistent returns compound far better than volatile ones with the same average.

What's the difference between simple and compound interest?+

Simple interest is earned only on the principal each period. Compound interest is earned on the principal plus all previously earned interest, so the balance grows exponentially rather than linearly.

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For educational purposes only. Not financial advice.