With this compounding effect, your investment's returns would increase exponentially as time goes on. This is something that you could to manually, however. You would simply need to spend some more assets on transaction fees, and compound your earnings every day or every week. Auto-compounders do that for you, however. Not only would you not be paying transaction fees every time you compound, but the auto-compounding contract will likely have a strategy to compound as efficiently as possible; maximizing your returns.