Doubling period

Doubling period is the period which makes the investment as "Doubled", that is the amount invested fetches 100% return.

There are two different approaches Viz.
1. Rule of 72
2. Rule of 69

1. Rule of 72

The initial amount of investment gets Doubled within which 72/I

Where, I = Interest Rate of the investment.

For example

The amount of the investment is Rs.1,00,000. The annual rate of interest is 12%.

Then the doubling period of Rs.1,00,000 is 72/12 = 6 years

2. Rule of 69

The amount method is found to crude logic in determining the doubling period which has its own limitations. The rule of 69 eliminates the bottleneck associated with the rule of 72 method.

The rule of 69 is originate to be a scientific and rational method in determining the doubling period of the investment made

As per rule of 69 method the doubling period is calculated as 0.35+ 69/I

For example

The amount of the investment is Rs.1,00,000. The annual rate of interest is 12%.

Then the doubling period of Rs.1,00,000 is 0.35+ 69/12= 6.1 yrs