Compound growth calculator
Small consistent returns compound into large ones. Enter your starting capital, an average monthly return and a time horizon to see where the account could be — and how sensitive the result is to the monthly figure.
Results
- Final capital
- 1,795.86
- Total growth
- 79.6%
These tools are for education only. Check your broker's contract specifications — pip sizes, lot sizes and margin rules vary.
What is compound growth in trading?
Compounding means earning returns on your previous returns. When a trading account grows 3% in a month and you keep the profit in the account, the next 3% is earned on a larger balance. Over many months the curve bends upwards: $5,000 growing at 3% a month becomes about $7,129 after one year and roughly $10,160 after two, without adding a single deposit.
This calculator is a planning and reality-check tool. It shows what a realistic monthly return does over time — and, just as important, how absurd the results become when the monthly figure is inflated. If a plan needs 20% a month to work, the numbers here will show why almost nobody sustains it.
How to use the compound growth calculator
Enter your starting capital
The balance you begin with. Only the ratio matters for the percentage growth, but the money figures are easier to relate to.
Set an average monthly return
Use the net percentage you actually make after losses and costs. A 2–5% monthly average is already an excellent long-run result.
Choose the number of months
Twelve months shows one year; 36 or 60 months makes the effect of compounding obvious.
Read the final capital and growth
The result gives the ending balance, the total growth percentage and a month-by-month series you can compare with your own equity curve.
Compound growth formula
Final capital = Initial capital × (1 + Monthly return) ^ Months
Total growth % = (Final ÷ Initial − 1) × 100Example: $5,000 at 3% per month for 12 months = 5,000 × 1.03¹² = 5,000 × 1.4258 = $7,128.80, a total growth of 42.6% — versus $6,800 (36%) if the same $150 profit were withdrawn every month instead of reinvested. At 5% per month the same account reaches $8,979 in a year.
Compounding tips for traders
- Trading returns are not a fixed interest rate. Use a conservative average that includes your losing months; then treat the projection as an upper bound.
- Compounding works in both directions — recalculating position size after every trade also makes losses shrink positions, which protects the account in drawdowns.
- Decide a withdrawal rule in advance (for example, take out half of any month above 5%). Taking profits off the table is part of long-term survival.
- Compare the projection to your actual equity curve every quarter; if reality is far below, the monthly figure was optimistic — not the compounding.
Compound growth FAQ
How do I calculate compound growth on a trading account?
Multiply the starting balance by (1 + monthly return) raised to the power of the number of months. $10,000 at 2% for 24 months: 10,000 × 1.02²⁴ = $16,084, a growth of 60.8%.
What is a realistic monthly return in forex?
Sustained returns of 1–5% per month are considered strong; many professional funds target 10–20% a year. Claims of 20–50% a month almost always come with drawdowns that eventually end the account.
How long does it take to double an account?
Use the rule of 72 as a guide: divide 72 by the monthly return. At 3% a month it takes about 24 months; at 6% about 12 months. The calculator shows the exact month it crosses double.
Is compounding better than withdrawing profits?
Compounding grows the account faster, withdrawing locks in gains. Many traders do both: reinvest until the account reaches a target size, then withdraw a fixed share of profits each month.
Does compounding change my risk per trade?
Only in money terms. If you risk 1% of the current balance, the money at risk grows as the account grows while the percentage stays the same. That is exactly what makes compounding work for a risk-based sizing rule.
What return do prop-firm challenges need?
Typical challenges ask for an 8–10% profit target under a 5% daily and 10% total drawdown limit, with no time limit or a one- to two-month window. Plug 2–3% a month into the calculator to see how many months a realistic pace needs.