Does 200% gain per year sound ridiculous?

[vergis92]

I recently posted a thread looking for acc to trade, and claiming that I can make up to 200% per year using the described techniques, all the response and comments I got were arrogant, implying that I am either a scammer of some kind or that 200% is not possible, or that there's definitely something wrong in the said trading techniques and simulated acc results. (every possibility to eliminate the claim)


How much is a 200% annual gain, in absolute numbers ? it means to tripple a given amount of money, $1 becomes $3 over the course of one year.


And people seem to be too naive about the profitability of ordinary small to medium businesses , such as convenience stores / corner shops, small trading businesses that actually do make 200% per year, within the lmits of their market.

If a corner shop owner invests £20,000 to fill the shop's shelves, he expects after buying and selling new stock several times, in a year, to have got back £60,000 by year end.


As far as the 200% gain a year, I see nothing ridiculous, I just think that most people are conditioned to think suspiciously, and make premature assumptions.



let's see the % gain performance of other, hands-on investments, with direct, tangible assets:


Antiques & fine art investing - it is possible to make 10 fold gains if you try hard enough, if you do nothing, and just buy and sell, you still make 10-20% a year, without serious risk of losing money.


Biofuels investing: You can make a fortune, as long as you invest in the right market, right country, and take advantage of tax loop holes that allow you to sell big quanitties of fuel, such as biodiesel to companies that operate truck fleets.
Profitability? it really has no limit, you can invest $300,000 and make $50 millions over 3 years, or 450% a year.

and no, I cannot match the possible realistic gains of fine art or biofels, in my stock trading by any means, but 200% is possible.

So to the arrogant negative thinkers out there, I can't see what's the big deal when an investment proposal says, that $1 can be turned into $3.:?:

 

[Mr X]

I recently posted a thread looking for acc to trade, and claiming that I can make up to 200% per year using the described techniques, all the response and comments I got were arrogant, implying that I am either a scammer of some kind or that 200% is not possible, or that there's definitely something wrong in the said trading techniques and simulated acc results. (every possibility to eliminate the claim)

How about starting a live journal...?

 

[scose-no-doubt]

http://martinkronicle.com/2012/01/08/aaron-browns-red-blooded-risk/

 

[Mr X]

Aaron Brown Interview: Red Blooded Risk | MartinKronicle

Thanks, looks a good article, will read later.

Thought I recognised him: FuseTalk User Profile

 

[the hare]

200% is easily achievable, but quite a meaningless figure in isolation. What sort of leverage are you using to achieve those types of returns ?, what percentage drawdown might a punter be expected to tolerate to achieve that ?

 

[Eric Geddes]

200% is easily achievable, but quite a meaningless figure in isolation. What sort of leverage are you using to achieve those types of returns ?, what percentage drawdown might a punter be expected to tolerate to achieve that ?

Agreed. And 200% of what?

 

[Mr X]

and 200% of what?

100%?

 

[new_trader]

When I was younger I used to think big, but now, with the benefit of hindsight, I can say without a doubt that slow and steady is the best and most achievable path to wealth. A gain of 200% might be possible for a few years, but the trick is building and keeping your wealth.

 

[anley]

I recently posted a thread looking for acc to trade, and claiming that I can make up to 200% per year using the described techniques, all the response and comments I got were arrogant, implying that I am either a scammer of some kind or that 200% is not possible, or that there's definitely something wrong in the said trading techniques and simulated acc results. (every possibility to eliminate the claim)

You have a point about the knockers but there's always a caste iron way to shut them up - post your statements (not simulated) Most people have problems with that so there's your way to be different.

Nothing works in backing up talk like proof of gains otherwise it's just that talk, hence the knockers are going to be on your case.

Always remember though that good trading is always a balance of gain versus risk do no point posting a 200% gain on December 31st but in July you were down 80% before making it all back and more.

 

[Hotch]

The mocking you received wasn't anything to do about the figure, it was, as people have pointed out, that you didn't put it in any context, which means it's meaningless, and yet you thought it was obviously very meaningful.

 

[vergis92]

You have a point about the knockers but there's always a caste iron way to shut them up - post your statements (not simulated) Most people have problems with that so there's your way to be different.

Nothing works in backing up talk like proof of gains otherwise it's just that talk, hence the knockers are going to be on your case.

Always remember though that good trading is always a balance of gain versus risk do no point posting a 200% gain on December 31st but in July you were down 80% before making it all back and more.

I was too honest in my proposal, and wrote about my past, more specifically:
11 years trading, 8 years of trading with real money and simple, lame directional techniques that eventually cost me $25,000+ real money in losses over those first 8 years.

Trading with simulated acc also for the entire 11 years, and only in 2008 I managed to become profitable.

My stock / stock Option simulated trades were performed on the virtual rading platform of OptionsXpress, not a 100% perfect simulation but still very realistic,
and as I said, in previous years I was a complete loser.

Is simulated trading reliable? if you trade deep, in the money Options, and over several days per trade , yes, you can figure out straight away how it would be in the real world.


A friend of mine in the US has a less efficient strategy, and he does make it work with real money, on a small account. (went from $5,000 to $11,000 in 6 months)
the guy is only 22 years old, knows much less about predicing market direction, but yet he manages to trade without the risk of account blowout.



My latest trading tecniques were implemented over a year, trading only 3 months or so, taking the simulated acc from $150,000 to $250,000, but it's not so simple,

I always had to carry open losing positions throughout the 3 month period, a total open loss of over $20,000 at times, and closed those trades at minimum loss later.

What makes this technique a winner, is high rate of winning trades, not having to inccur unecessary losses due to stop loss running etc, and one strategy that offers highly asymmetrical R/R.

I don't think I could achieve any profitable results in stock futures trading, due to the stops problem, the market flash crash issues, and the dollar for dollar pricing nature of futures.

I also have a spot forex technique that is working, but it's very selective, requireing only 7-8 days in the month to be traded, but it's not the best to handle an investor's account. for stress reasons I would prefer and would feel 100% comfortable to trade an Option account.

 

[vergis92]

When I was younger I used to think big, but now, with the benefit of hindsight, I can say without a doubt that slow and steady is the best and most achievable path to wealth. A gain of 200% might be possible for a few years, but the trick is building and keeping your wealth.

Yes, the objective must be safety of funds first, profits later, trade only and when your criteria are met. And I do not favour financial trading over antiques trading, it's just that these millionaire investors I have come across will never trust you physical funds, whereas in financial trading they might eventually agree to allow you to trade their acc, you cannot steal the funds anway.


I have talked to many angel investors and they are usually happy to invest in anything they can perform due dilligence on, so they understand it, and as long as it makes 30% or more per year, they may invest.

But in financial trading, they don't understand the techniques, they fear the markets as being very risky, or simply ask the question; 'How come you are not trading with your own money?' which is stupid thing to ask, all people who seek investors, do so because they don't have capital.

I certainly don't have $50,000 or $100,000 to implement my trading ideas, despite the fact that I know I am going to win and almost certainly make a lot.

All I have is few $1000s which I have successfully placed in the antiques market, and I think that's the safest, and stress-less bet for all undercapitalized traders.


I don't believe that anyone can do successful and meaningful financial trading, that will pay you for your time, with less than $20,000

 

[VielGeld]

Entirely possible, so long as your account isn't massive or something.

You could probably do it with up to $1m, or maybe $10m depending on the market if you keep pushing for performance. Liquidity problems are bound to kick in with any more than that. I don't think scalpers can go higher than $1m, though, and that's on 1:1 leverage.

Liquidity's really the only limiter to a highly successful strategy.

 

[vergis92]

Entirely possible, so long as your account isn't massive or something.

You could probably do it with up to $1m, or maybe $10m depending on the market if you keep pushing for performance. Liquidity problems are bound to kick in with any more than that. I don't think scalpers can go higher than $1m, though, and that's on 1:1 leverage.

Liquidity's really the only limiter to a highly successful strategy.

Yes, liquidity issues, especially with bad brokers, is big issue, OptionsXpress charge very high commissions per trade, but if you look under the hood, and how they operate, they are able to deliver faster and better filling price, this means that to a serious trader , this broker is actually the best since it can save them a lot of money, as opposed to low cost brokers.


As long as you invest say $100,000 and turn it into $300,000, in forex / stocks etc, it's a lot of money, you can then diversify into real estate / antiques, I wouldn't continue financial trading with all that money. maybe just enough to
satisfy my addiction /curiosity, after 11 years trading I cannot just throw it away, none of us can easily quit trading.

In fact, in a study done by Larry Williams, he found that both winners and losers are strongly addictied to trading.


Because of the money paradox, I prefer to do it with a large acc, this paradox is conformed by some of the best winning traders in the world, no matter what they traded:

it took them X months to go from $20,000 to $40,000

but to go from $40,000 to $80,000, it took them less than half X

at some point, profitability becomes maximum possible, and because of liquidity and market limits, trading system rules, they cannot risk any more,

Larry Williams went from $10K to 2 M, then back to $1.

Another trader in London turned £1m into £6, very steadily, in one year.


some of them quit trading afterwards

 

[anley]

Dump OE and go with Interactive Brokers for your options and commissions, money saved in this business is pure profit.

The problem you might have with your trading strategy is options, very costly to trade them (bid-offer spread) and as others have said the liquidity is often not that good.

Is there anyway you use futures instead?

 

[VielGeld]

Dude, OpX sucks balls. The commissions they charge are the highest I've seen, and coupled to the B-A they makes many trades difficult to even break even.

The might be the problem. Anley has it right in that IB is a much better alternative. They only charge like $1 for options trades. Much, much better than OpX. The offset is a bare-bones approach to stuff like charts, data, etc.

 

[DionysusToast]

I was too honest in my proposal, and wrote about my past, more specifically:
11 years trading, 8 years of trading with real money and simple, lame directional techniques that eventually cost me $25,000+ real money in losses over those first 8 years.

Trading with simulated acc also for the entire 11 years, and only in 2008 I managed to become profitable.

My stock / stock Option simulated trades were performed on the virtual rading platform of OptionsXpress, not a 100% perfect simulation but still very realistic,
and as I said, in previous years I was a complete loser.

Is simulated trading reliable? if you trade deep, in the money Options, and over several days per trade , yes, you can figure out straight away how it would be in the real world.


A friend of mine in the US has a less efficient strategy, and he does make it work with real money, on a small account. (went from $5,000 to $11,000 in 6 months)
the guy is only 22 years old, knows much less about predicing market direction, but yet he manages to trade without the risk of account blowout.



My latest trading tecniques were implemented over a year, trading only 3 months or so, taking the simulated acc from $150,000 to $250,000, but it's not so simple,

I always had to carry open losing positions throughout the 3 month period, a total open loss of over $20,000 at times, and closed those trades at minimum loss later.

What makes this technique a winner, is high rate of winning trades, not having to inccur unecessary losses due to stop loss running etc, and one strategy that offers highly asymmetrical R/R.

I don't think I could achieve any profitable results in stock futures trading, due to the stops problem, the market flash crash issues, and the dollar for dollar pricing nature of futures.

I also have a spot forex technique that is working, but it's very selective, requireing only 7-8 days in the month to be traded, but it's not the best to handle an investor's account. for stress reasons I would prefer and would feel 100% comfortable to trade an Option account.

Here's the thing.

You have been here many times before. Not exactly YOU but someone like you.

Of course you have a high hit rate. That is because you risk $2500 to gain $150.

Do a search for Howard Cohodas on the board, see where he ended up with high win rate option strategies.

You have SIM traded a technique and now you want someone else to fund you to trade it live? lol!!!

Like I say, there's someone like you on the board every 6 months, the result is always the same.

Long may it continue I say.

 

[anley]

Of course you have a high hit rate. That is because you risk $2500 to gain $150.

Oh deary me, not only is that reverse risk/reward ratio not going to make you any money overtime, it's probably a one way express lane to bankruptcy, or at least a minimum drawdown of 75% which arguably is the same in this business as it means you give up.

Yes, I hear all the arguments about focus onthe average win rate and that might be 80%+ but here's the thing, even at 80% winners you won't have any confidence in your strategy (although you might think you do). See, run a sample of trades and you WILL have a loss of 5 or even 10 trades on the trot, and when that happens you'll be out of the game.

Summary: Without having confidence in your method it's impossible to make money overtime in this business and a 1:5 risk/reward ratio offers ZERO confidence because deep down you know it's just a matter of time before that 5-10 serios of losses comes......

back to the drawing board, look for 3:1 trades, then you can afford to be wrong 70% of the time and still make money.

 

[DionysusToast]

A friend of mine in the US has a less efficient strategy, and he does make it work with real money, on a small account. (went from $5,000 to $11,000 in 6 months)
the guy is only 22 years old, knows much less about predicing market direction, but yet he manages to trade without the risk of account blowout.

How is it possible to know LESS about predicting market direction that someone that traded for 8 years and lost money, then SIM traded another 3 years and settled on a non-directional system?

This is a wind-up, right?

 

[wackypete2]

Long may it continue I say.

Quality lulz = boredom buster

Peter