# Doubling Time Formula Continuous Compounding

## Formula

`n to double = LN(2) / i`
Variables used in the formula
i = Discount rate
n = Number of periods to double the investment
LN = natural logarithm

## Use

The doubling time formula continuous compounding is used to work out the amount of time (n) it takes to double the value of a lump sum investment allowing for continuous compounding at a given discount rate (i%).

## Doubling Time Formula Continuous Compounding Example 1

If an investment is made at the start of period 1 and compounded continuously at a discount rate of 7% per period, then the number of periods it takes to double the value of the investment is given by the doubling time formula continuous compounding as follows:

```n to double = LN(2) / i
n to double = LN(2)/ 7%
n to double = 9.90 periods```

## Doubling Time Formula Continuous Compounding Example 2

If an investment is made at the start of period 1 and compounded continuously at a discount rate of 1% per month, then the number of months it takes to double the value of the investment is given by the doubling time formula continuous compounding as follows:

```n to double = LN(2) / i
n to double = LN(2)/ 1%
n to double = 69.31 months ```

This formula is used when compounding takes place on a continuous basis, if compounding is not continuous, then the standard doubling time formula should be used instead.

The doubling time formula continuous compounding is one of many used in time value of money calculations, discover another at the links below.

Doubling Time Formula Continuous Compounding November 6th, 2016

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