Can you get a 60% return? Fact checking this viral video

Can you get a 60% return? Fact-checking this viral video

Introduction

A viral video has been making rounds on social media, where a young person claims that an investment of $ 20,000 in an energy mutual fund will yield $ 3,000 every 90 days, which amounts to a 60% annual return. This return is astronomically high compared to traditional investments and has led many to question its validity.

60% Return: Too Good to Be True

For context, even elite hedge funds rarely generate an annual return beyond 15%. The broader S&P 500, a standard benchmark for U.S. equities, generally offers an approximate annual return of 8%. A consistent 60% return on investment is virtually unprecedented in the financial world.

If one were to achieve a 60% annual return on a $ 20,000 investment, in 30 years, with compounding interest, the investment would hypothetically grow to over $ 26 billion. This scenario seems highly implausible and far-fetched.

Possible Misunderstanding

To give the benefit of the doubt, the speaker in the video might have meant an initial investment of $ 200,000 rather than $ 20,000. Nonetheless, even a $ 200,000 principal delivering consistent 60% returns remains unrealistic by traditional financial standards.

Conclusion

Be cautious about investment claims that seem too good to be true. High returns are often associated with high risk, and consistent returns of 60% are rare and should be scrutinized carefully. Always conduct thorough research or consult a financial advisor before making any significant investment decisions.

Keywords

• Viral video
• Investment
• Mutual fund
• Energy sector
• Annual return
• Hedge funds
• S&P 500
• Compounding interest
• Financial advisor

FAQ

Q: Can I really get a 60% annual return on my investment? A: It is highly unlikely. Even the best hedge funds and market indices typically deliver far lower returns.

Q: How much would a $ 20,000 investment grow in 30 years with a 60% return? A: Hypothetically, it would grow to over $ 26 billion, but such a scenario is very far-fetched.

Q: What is a realistic annual return on investment? A: Hedge funds may achieve around 15%, while the S&P 500 typically offers about 8% annually.

Q: Should I trust investment claims that promise high returns? A: Always exercise caution and perform due diligence or consult a financial advisor before making any investment decisions.

Q: What might the video speaker have meant if not a $ 20,000 investment? A: It's possible the speaker intended to reference a $ 200,000 initial investment, but even then, 60% returns are unrealistic.