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What is a reasonable return
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What is a reasonable return

  #101 (permalink)
Trading for Fun
Scottsdale
 
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bijeremiad View Post
Here are the trading results of a day trader from Norway.

"Averaged" $1475 per day over 10 years. First few years were "learning", good years 2006-2009, more challenging lately.

85.7% profitable days. Only 15 losing days in 2006, 17 in 2007 and 8 in 2008. But more recently he has had two losing months in January 2012 and April 2012.

Another thing to keep in mind is that his profit is only 0.07% of the notional $5.1BN of stock traded. Edges are tiny.

See that's scary to me, the discrepancy between his total profits and total $ value of stock traded. You have to have a certain mindset to be able to deal with that high risk all the time.

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  #102 (permalink)
Trading Apprentice
Amman/Jordan
 
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GFIs1 View Post
Main points are
1) System consistency with small Dradown rate and phase
2) Percentage of money @ risk you are willing to put in the market

Looking back to the result of last year in my journal https://futures.io/trading-journals/17862-gfis1-1-dax-trade-per-day-journal-54.html
I had a result of 1015 points after 52 weeks. Each point is 25 EUR. So the total is roughly 25K EUR net.
Giving a margin (at Interactive Brokers) which varied over the year for the FIRST Dax future INTRADAY
between 6600 EUR to 9000 EUR and we take the less favourable 9000 and put ALL IN to trade then the
gain was > 250% on that first capital. (Of course much less if you only trade 2% of your money).
Stacking up over the year the gain to trade more than one Dax future (the margin from the second one
is less) could have given 750% (with 1-5 futures over the year and 3 at the end).
Just an example of how that gain percentage can vary.
If this was a good year I can not tell - but some experience in trading is absolutely necessary...

GFIs1

I dont think this calculation is right . There's something called drawdown so 9K isn't nearly enough to trade the FDAX , if your stop is 40 points away , then just a handful of losses will make your account down by 200 points = 5K ! And you cant move from 1 contract to 2 contracts until you double your money ...

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  #103 (permalink)
Market Wizard
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Surprise View Post
I dont think this calculation is right . There's something called drawdown so 9K isn't nearly enough to trade the FDAX...

You cite a post of 2012...
So you haven't read the thread to the end. If so you could see the weekly progress which shows how many
trades were positive and how many negative. There was never a series of many negative trades in a row.
Every year counting start at 0 at the beginning.
Just read the thread to the end.
Then you will be aware that the stops are 30 points away.
I will not comment here about consistency.
And btw today the margin for one Dax is > 12K...

GFIs1

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  #104 (permalink)
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GFIs1 View Post
You cite a post of 2012...
So you haven't read the thread to the end. If so you could see the weekly progress which shows how many
trades were positive and how many negative. There was never a series of many negative trades in a row.
Every year counting start at 0 at the beginning.
Just read the thread to the end.
Then you will be aware that the stops are 30 points away.
I will not comment here about consistency.
And btw today the margin for one Dax is > 12K...

GFIs1

I know its 12K now and i know your stop is 30 , getting a few consecutive losses is not far fetched while trading the FDAX , so being down 150-200 points - 3750 to 5000 euros - is not out of the question which means big drawdowns if you are trading with just 12k euros ... you need more than that to trade 1 contract you cant just rely on initial margin requirements . Thats why it was a pure hypothetical calculation that cant be realized in real life environment .

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  #105 (permalink)
Market Wizard
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Quoting 
could have given 750% (with 1-5 futures over the year and 3 at the end

That was meant a hypothetical max. gain.
My journal is for comparison reason fixed on one contract.
Every trade is announced at taking time together with the exit time.
That does not mean that we start every day at the margin limit.

Money management is the heart of every system.

Good luck
GFIs1

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  #106 (permalink)
Elite Member
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If you take one trade a day risking .38% of your account, and you lose every time, it'll take about an entire year before you go broke.

Considering you have a 50% accuracy and 1:2 r:r you should make about 100% in one year if you don't compound. After taxes, commission, and slippage you should be around 50% modestly. Considering 50% at 1:2 is pretty hard to achieve day in and out, I'd say you should be in the ball park of 20-30% realistically speaking. 15-25 thousand a year is reasonable after all other costs, a few year learning curve, if you trade only two hours a day, and have another job.

The good part is that if you can keep that up for a few years or more you can probably start compounding some of it and have access to trading larger accounts. That's my two cent ball park answer for most people. Considering the amount of variables involved it's hard to say anything is reasonable in trading.


Last edited by Itchymoku; January 1st, 2016 at 12:54 PM.
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  #107 (permalink)
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GFIs1 View Post
That was meant a hypothetical max. gain.
My journal is for comparison reason fixed on one contract.
Every trade is announced at taking time together with the exit time.
That does not mean that we start every day at the margin limit.

Money management is the heart of every system.

Good luck
GFIs1

Not possible with the amounts mentioned above , some extra cushion is needed ...


GL

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  #108 (permalink)
Market Wizard
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Surprise View Post
some extra cushion is needed ...

This is my last reply to @Surprise here in this thread:
Of course it needs a cushion for the start - as one can not be at the margin limit
and hope to have the next few trades with positive outcome.

I encourage you to open your own journal(s) here on futures.io.
Journal every trade here and explain why you will take it in the intro.
If you have the guts to publish your trade BEFORE you take it with
entry, exit, SL, direction and you report your gains over a year of
journaling - THEN I am again here to discuss the OP's title of the
thread "what is a reasonable return".

But not before

GFIs1

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  #109 (permalink)
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GFIs1 View Post
This is my last reply to @Surprise here in this thread:
Of course it needs a cushion for the start - as one can not be at the margin limit
and hope to have the next few trades with positive outcome.

I encourage you to open your own journal(s) here on futures.io.
Journal every trade here and explain why you will take it in the intro.
If you have the guts to publish your trade BEFORE you take it with
entry, exit, SL, direction and you report your gains over a year of
journaling - THEN I am again here to discuss the OP's title of the
thread "what is a reasonable return".

But not before

GFIs1

LOL

I already have a live journal in another forum , but i trade cfds , i may open a thread here why not will see . That being said i am here to discuss " what is a reasonable return " and your hypothetical example wasn't reasonable at all ....


GL

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  #110 (permalink)
NDioWealthAmp
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Survival matters the most : any positive return with a drawdown capped at 15%. Ideally, matched to a yearly return on investment 2 to 3 times worth the heat (MaxDD).
Trading deleveraged needs to be consistent in order to reach long-term stability (both at and outside the field!)


Last edited by NapoleonDynamite; January 3rd, 2016 at 02:59 AM.
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