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How LONG would it take you to turn $50,000 into $190,000???

DustinH

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I get a news alert today that the S&P 500 hit the 3,000 mark again and felt compelled to do some math.

If you invested $50,000 into the S&P 500 at the lowest trading day of the 2008-2009 recession (S&P 500 = 797).... and waited.... and waited.... and waited.... and sold it 10 years later (right now) you would have profited $140,000.

Not to mention you had to have made about $71,500 to be able to buy equities with post-tax money. Also, not to mention the erosion of the value of the money through inflation.

My question is, how long would it take you to invest $50,000 into your business and make $190,000 in revenue directly from it? One year? Six months? My guess is less than 10 years.
 

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AgainstAllOdds

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at the lowest trading day of the 2008-2009 recession
If you could correctly identify the lowest point, then you wouldn't be turning $50k into $190k, but into a billion through options, etc.

That's the problem; you can't identify the lowest point.

For most people, the stock market is a horrible means of wealth creation. It's a great means of wealth preservation. Significant difference.

With an asset that you fully control, it's reasonable to have 20% growth year over year.

That would imply that your $50k would turn into $309k during the same time period (without having to correctly identify the low point). Or in other words, it would take you 7 years and 3 months to hit the same return as the stock market. If you can get the average angel investment return (27% per year), then you'd have $545k in those same ten years. Problem is that most people aren't cut out to be entrepreneurs or equity investors.
 

Grinder20

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If you could correctly identify the lowest point, then you wouldn't be turning $50k into $190k, but into a billion through options, etc.

That's the problem; you can't identify the lowest point.

For most people, the stock market is a horrible means of wealth creation. It's a great means of wealth preservation. Significant difference.

With an asset that you fully control, it's reasonable to have 20% growth year over year.

That would imply that your $50k would turn into $309k during the same time period (without having to correctly identify the low point). Or in other words, it would take you 7 years and 3 months to hit the same return as the stock market. If you can get the average angel investment return (27% per year), then you'd have $545k in those same ten years. Problem is that most people aren't cut out to be entrepreneurs or equity investors.
@AgainstAllOdds, the management fees alone are mind boggling and will erode any gains.
 

100k

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What if you plus 9 of your buddies came together and put $500k ($50k each) into a new venture - and used the equity to buy a cash producing asset for example a business that costs $1.5 million.

You put $500k down, the bank puts another $500k down and the seller gives you $500k in seller's finance.

And let's say the business makes about $500k profit per year after taxes & liabilities.

I think if you re-invested some of the profits (hired consultants and found some new distribution channels & new markets) you could reach your goal in 5 years.
 

JScott

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That's 14.3% compounded annual growth (CAGR) for a completely passive investment.

I don't think there are too many investors out there who wouldn't be THRILLED with that kind of return these days.

While I'm not at all a fan of the stock market for my money, I think you picked a really bad example here. While you were trying to point out that this isn't a good investment, this particular investment over the past 10 years would have been fantastic compared to many other completely passive investments (like bonds, CDs, collectibles or even rental real estate).
 

StefanoUP

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Or a few weeks / months on the FOREX if you are good at it - but of course with some attached risk.
 

JScott

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With options, you could do that in a few weeks.
Or a few weeks / months on the FOREX if you are good at it - but of course with some attached risk.
$50K to $190K in a few weeks with options or FOREX?

I imagine that would be a ridiculous level of risk?

If you have a way to reliably 3.8x your money every two months, you would be able to turn $100 in $240,000,000 in two years. If you've done that, let us know...

Note that if you wanted to go the high-risk route, you could do this in about 5 minutes with two spins of a roulette wheel -- and with about 25% chance of success!
 
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Jaden Jones

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$50K to $190K in a few weeks with options or FOREX?

I imagine that would be a ridiculous level of risk?

If you have a way to reliably 3.8x your money every two months, you would be able to turn $100 in $240,000,000 in two years. If you've done that, let us know...

Note that if you wanted to go the high-risk route, you could do this in about 5 minutes with two spins of a roulette wheel -- and with about 25% chance of success!
I dont know anything about forex, but the risk on options would be lower than you think, and way lower than roulette. The thing about options is timing. If you can accurately predict a run, which is possible with charting, candle tracking or elliot waves, you could do quite well within that period of time. I have duplicated this a couple times. But these high confidence events dont happen often. So you might only be able to do that, say 4 or 5 times a year, which you would probably be wrong on 1, maybe 2. But with a controlled loss, you would still be way up. There are many people who make lots of money off options, but they most likely went through an expensive learning curve (me), or are well financed. If your interested in making money from options in a very low risk way, MJ has a wonderful thread on here about selling options.
 

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JScott

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I dont know anything about forex, but the risk on options would be lower than you think, and way lower than roulette. The thing about options is timing. If you can accurately predict a run, which is possible with charting, candle tracking or elliot waves, you could do quite well within that period of time. I have duplicated this a couple times. But these high confidence events dont happen often. So you might only be able to do that, say 4 or 5 times a year, which you would probably be wrong on 1, maybe 2. But with a controlled loss, you would still be way up. There are many people who make lots of money off options, but they most likely went through an expensive learning curve (me), or are well financed. If your interested in making money from options in a very low risk way, MJ has a wonderful thread on here about selling options.
Yup, I'm familiar with options and I trade options a good bit (certainly not professionally).

My point is that your comment that you could turn $50K into $190K in "in a few weeks" is horribly misleading. You partially clarified it above -- you said that you can do that "4 or 5 times a year," when all the conditions are right.

Unfortunately, I don't believe that either. Even if you tell me that you have the ability to grow an investment that much only THREE times per year, that would mean you have the ability to turn $1000 into $165M in just three years.

Have you done that? Do you personally know anyone who has?

If not, then suggesting it's possible is misleading...or just flat-out wrong.

Long story short, when someone tells me that they have the ability to generate huge returns on their investments, it's easy enough to verify those claims by looking at their net worth. Compounding is a strong force, and anyone who can consistently generate large returns should be tremendously wealthy in a very short period of time. If they're not wealthy, they aren't telling the truth.

Instead of giving us hypotheticals on what crazy returns can be achieved, why not tell us what your ACTUAL annualized returns have been over the last few years?
 

MJ DeMarco

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MJ has a wonderful thread on here about selling options.
While I agree this experiment can be done with options, it still is risky because ultimately you're using a leveraged product. You could lose that $50K in a matter of weeks. (Or more if you're selling options which is my chosen poison). That said, if I was challenged (or forced) to do so, I'd probably do a pre-earnings call buy on an instrument that has a pattern of pre-earnings optimism. In other words, the option play would have a backtested history of success. I will only buy options under those circumstances.


My question is, how long would it take you to invest $50,000 into your business and make $190,000 in revenue directly from it? One year? Six months? My guess is less than 10 years.
That said, I believe business is a much better method in doing so. This thread here ...


...actually has someone doing it -- that $50K could be used to buy a digital business (or businesses) that produce decent returns.
 

Ing

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Search a beginning of a war, buy bears 2 days before and sell the day of its beginning.
I turned 100€ into 4000€ in 3 days at the first gulf war.
Well, mustnt think about i had invested 10000.....
 

aminmo

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Well, with my first successful ecom store, I turned $5k (wasn't even actual money, I was using a family member's credit card) and generated $1-million in revenue in about 2 months.

Granted, there was a large amount of luck involved, but I've reproduced similar results (albeit with lower revenue numbers, of course lol) with other stores after that.

Using $50k to make $190k in revenue is extremely easy in the eCom space. Turning $50k into $190k profit, however, is an entirely different story and much harder.
 

Charnell

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...actually has someone doing it -- that $50K could be used to buy a digital business (or businesses) that produce decent returns.
100%.

Just being curious, I decided to check out Empire Flippers to see what sort of website could be bought with $50k. We have this one here for ~ $33k that makes $1200 a month with AdSense: https://empireflippers.com/listing/46627/

Just by switching to a different advertising platform that revenue could be doubled or tripled in 1 month. Spend $10k on more content, the remaining $7k on website improvements, marketing, and fixed costs.

Keep jamming it out either creating content or hiring a content creator with revenue until it's making a consistent $7k a month & sell it for $190k.

EDIT: It wouldn't take for it to be making $7k a month to make $190k, depending on how much was being reinvested. That was assuming every dollar was being put back into it.
 
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