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What is a reasonable return
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What is a reasonable return

  #61 (permalink)
Elite Member
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@bushido

There was a poll taken among members, which can be seen here.

But if you are seeking consensus with a tight standard deviation, you are looking at the wrong industry.

Some questioned the poll results because they voted on what they hoped vs what they actually achieved. Anyone could vote - trader or not-yet.

The question is not totally clear in terms of equity and leverage, nor is it expressed in terms of R or % draw down. Even if you got a "number" it would be lacking in context. Are returns reinvested or harvested for income? Lots of different ways to approach it.

It is frustrating as you try and get a sense for the feasibility of trading and how much capital you would need. It is amazing that even after sifting through all caveats and disclosures and extreme percentages (90%, 10%, 5%...), it is so hard to find an answer. Many are happy to provide the gross statistic of X% fail, but few are willing to answer the conditional probability - given someone who survives what is the range of possible out comes. I've no doubt it is an difficult question to answer, but I doubt it is as hard to answer as it is to find the answer on a trading forum.

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  #62 (permalink)
Learn to swim
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@bushido, I didn't really come away with a clear answer either but in my trading since the time of this original post I still cannot put a figure on it because there are ups and downs. Also, sometimes there are not as many opportunities to trade at certain times, which requires me to sit out. Therefore, all of these factors make it hard to give an average and my returns are still too inconsistent to give a ballpark. Sorry.

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  #63 (permalink)
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Thanks bijeremiad and SammyD.

I guess we need traders who are consistently profitable to give us a sense of their MoM / YoY returns.

I'm just starting out in trading futures, hence wanted to get an idea of the average returns assuming I survive the first 6-12 months where 95-99% would fail.

I wanted to compare that with swing trading stocks where I think ~20% annual returns is reasonable with much less monitoring/skill/stress required

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  #64 (permalink)
Market Wizard
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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

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  #65 (permalink)
Trading Apprentice
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A day trader has to look at percentage results on a monthly basis, in my opinion. Very few day traders actually show profit on a yearly basis.

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  #66 (permalink)
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4 ticks a day = $50K a year

A 100% rate of return on your original investment per year is achieved by making only 1 ES point (4 ticks) per day on a 10K account. That is my rate of return on 1 contract. Trading 5 contracts on a 50K account, I earn $50K a year.

After I make 1 point, I go to SIM. More ticks are not necessary only more contracts to increase my return. Once you make it, don't give it back. Keep it! That is a hard lesson for most traders.

Ken "COTtrader"

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  #67 (permalink)
Market Wizard
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This is an article about the best earners out there:

The 40 Highest-Earning Hedge Fund Managers And Traders - Forbes

We see some of the best out there @ 25-30%
Some stars that shined in the past earned only 1%

adds perspective.

M

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  #68 (permalink)
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Seems like people are using different bases to calculate return. I think its more accurate if return is calculated over the account size (assuming entire account is for day trading futures) rather than margin posted for contracts traded.

@COTtrader Good point. 1 ES point a day = 100% assuming 1 contract per $10K in account. Something that sounds so straight forward but so difficult to do consistently!

@mattz thanks for the link. those hedge fund managers are throwing around billions of dollars though, probably oversized for intraday futures trading? I don't know.

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  #69 (permalink)
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bushido View Post
Seems like people are using different bases to calculate return. I think its more accurate if return is calculated over the account size (assuming entire account is for day trading futures) rather than margin posted for contracts traded.


@mattz thanks for the link. those hedge fund managers are throwing around billions of dollars though, probably oversized for intraday futures trading? I don't know.

You are most welcome. The idea was to show you what the best 40 are capable of, and to shed some perspective on risk/reward in trading.

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  #70 (permalink)
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COTtrader View Post
A 100% rate of return on your original investment per year is achieved by making only 1 ES point (4 ticks) per day on a 10K account. That is my rate of return on 1 contract. Trading 5 contracts on a 50K account, I earn $50K a year.

After I make 1 point, I go to SIM. More ticks are not necessary only more contracts to increase my return. Once you make it, don't give it back. Keep it! That is a hard lesson for most traders.

Ken "COTtrader"

Can you please tell what stops are used, and why go to sim as oppose to quitting trading for the day as in walking away.
Always interested in hearing perspective of other traders.

PM with any questions about optimusfutures (800) 771-6748 (561) 367 8686. THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES TRADING.
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