So we would need

So we would need to see $120 in our account at the end of a year to realize a 20% return.
We’re going to ignore the commissions charged for trades (because now we can!) Over the course of the month or even a week, is it unreasonable to have a stock gain 1.7%? Not at all. It is not uncommon for a stock to move that much in even a single week or even a single day. Let’s play this out in our example. Let’s say in January you buy a stock with your $100 it gains at least 1.7% within 4 weeks time (or less). You sell the stock and add a $1.70 to your account. You now have $101.70. Despite our earlier focus on compounding interest, let’s leave that out of this example to keep it simple. If you repeat the same set of steps with the same stock or a different stock in February, you add at least another $1.70 to your account. 12 months times $1.70 is $20.40. At the end of the year the account now has $120.40. Hmm, that is a 20% annual return! Reread section 1 to recall what this could mean for your retirement lifestyle.