Buying Starbucks Stock Instead of Starbucks Coffee: A Lesson in Compounding

If instead of purchasing a $4 coffee from Starbucks every trading day (~250 per year) you had purchased $4 worth of starbucks stock each day starting in 1992, how much money would you have today?

Steve Calk, a finance lecturer at Cornell (and major caffeine addict), once asked this question in a  lecture. I thought I’d do the calculation today.

The Answer: About $326,000

SBUX

SBUX.xlsx

Will Martin is an energy analyst and expert on peak oil and alternative currencies. He is an MBA graduate of Cornell University, where he was a Roy H. Park Leadership Fellow and concentrated on studying sustainability in business through the school’s Center for Sustainable Global Enterprise. Prior to his MBA, Will worked in the energy industry, living in Singapore, Houston and Dubai. Will is a recipient of the 2012 “Pioneer Award” from the Association for the Study of Peak Oil and Gas (ASPO-USA). He currently works as a carbon trading commercial adviser in the San Francisco Bay Area. Will is a bitcoin enthusiast and in 2014 published the book “Anonymous Cryptocurrencies,” which became a #1 best seller in 3 Amazon categories and was the first book to be sold on a decentralized marketplace.

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