The Art Of Execution – The Hunters: Hunting For The Compounding Effect

Apart from discovering that E=MC2, Einstein was also famous for saying: “Compound interest is the most powerful force in the universe.” John Larry Kelly Jr, a famed mathematician, showed that the way to create wealth was to invest in a manner that attempted to maximise the geometric mean of returns. By doing this you would exploit the power of compounding and become rich in the shortest possible time. I do not intend to go into the detail of the Kelly Criterion as it is now famously called, but suffice to say this formula shows that you should invest big when…