Most commonly used term in the financial circle. “Rule of 72” will help determine when an investment will get doubled. It is based on a simple formulae 72/interest = no. of years to double an investment.
Let us assume you have invested Rs.10000 in a mutual fund which fetches 20% returns. With the 20% return we can determine how long it will take to double the investment of Rs.10000. Now let us work out the formulae
72/20 = 3.6 years.
So we need 3.6 years for Rs.10000 to get doubled.
AnandNataraj 