Question

over a period of few months an investor get benefit of phenomenon called​

Answer 1

An investor gets the benefit of a phenomenon called​ compounding.

• It is the standard method of reinvesting an asset's potential earnings, whether they are from capital gains or interest, to produce more earnings over time.
• The considerable interval between when interest was last compounded and when it will be compounded again is referred to as a compounding phase.
• Annual compounding, for example, implies interest compounding for an year before it is compounded again. It represents the process of including interest to the principal of a loan.