How much capital do you need to trade full time?

[longshot666]

Provide his audited account records to prove this. At least show us his equity curve of an actual account over the last 4 years. I havent seen LW do anything in years, and outright gambling with horrible money management to win a one shot competition doesnt say much.

Are you sure about this?

LW did, and still does, do this - live. He also lectures and writes books.

 

[schoe]

Longshot. I see you are of the "I've been trading a long time and I know best club"

Tell you what,you have had " some very nice returns" why not start the ball rolling and post your Statements?

Not keen? I wonder why? then don't ask others to do the same.

ps, who mentioned forex? I said ym. and Tony Oz was making those returns by going long after the internet bubble had burst and was on the way down. Have you read the book? I have and have a signed copy here, its very expensive now so doubt if you can get a copy anyway.

 

[frugi]

Fruit containing fewer pips are sweeter and more consistent

In Frugiworld traders could be represented by a pyramid with a number of feral escalators leading up and down; the down escalators outnumber the up ones on account of their sharp teeth. Risk and return increase as we ascend the pyramid. Traders will, in the main, fall randomly on the escalators, in a sort of Brownian motion, but a few learn eventually to direct themselves to a height on the pyramid with which they are comfortable, somewhere probably near the middle. Here they stay, disciplined against the risky allure of daring to climb further, yet confident that enough precautions are in place to prevent an unexpected fall. Returns are not spectacular, but according to merit perhaps 2%-10% a month.

Perched on the pinnacle, outrageous returns are to be made. But the footing is precarious, the fall to the bottom precipitous. The escalators happen also to be particularly voracious.

At the bottom are the mass of creditors, the foundations of the structure, of which a few will of course progress upwards. There are doors into the ground floor through which greedy people swarm in their thousands, tempted by the legendary view from the summit. (Only last week did they see someone on the cover of Barron's soaking up that purty view and dispensing aphorisms 'i got to the top by being right only 1 in 10 times, but when i was right boy i was so right' from beneath their luxuriant hair.)

Survivorship bias ensures we only hear about those scrabbling around the top and we like to attribute special talents to them, to look for a pattern in their common excellence so that we can learn their traits. Yet largely these temporary wild successes will shuffle back down, unnoticed; soon we hear about the new handful who replace them and forget about the last crop. The odd trader will, I believe, have special qualities and be able to maintain a position well into the top half of the pyramid (20-30% a month?), but nobody stays on the peak for ever. Luck simply wouldn't allow it. Then again, there's meant to be a chance of 30 to 1 that something absolutely amazing (winning the lottery thrice in a row for instance) will happen to someone in their lifetime. (I don't mean someone as in each of us has 30:1 odds, I mean just one person alive at this moment enjoys them. Hope they get lucky!)

Finding a bit of pyramid -

Trade 2 EUR contracts once a day risking 2% of £21500 a day. Net 4 pips a day after commission und slippage for 47 weeks of the yr = £13055 pa. Knock off a grand for CGT. Accept that 13 consecutive losses will occur, trimming 25% of your starting capital at some point. Double this to be sure. So, you risk 50% of your money to make 56% a year (4.7% a month). Sound familiar? Risk virtually nowt and make 6%, the difference. There's something in that! Risk adjusted return perhaps?

Sorry to repeat myself.

 

[longshot666]

Still waiting for evidence of anyone making 30% a month over a course of several years and different markets to prove they are not a statistical anomaly. You havent provided any proof, and no one else has either. What can we conclude?
As for Tony Oz, why dont you post exactly what he made during the timeframe his book covers, because I seriously doubt it is anywhere near 30% a month for any statistically significant period of time. Note: Tony Oz is not a billionare is he?

Here is another dose of reality. If you make 30% a month, even for just one year, by then end of the year, your return on your initial equity will be: 2329%

Are you claiming Tony Oz pulls 2329% a year??? But he still is not a billionare right? Right.

" I see you are of the "I've been trading a long time and I know best club" "

No, i'm in the "I reject rumours, fantasies, and hearsay club"

Like I said, I think ill be waiting a very long time for any real evidence.

Post my statements? What would that prove? Without giving up my anonymity it proves nothing. Anyone can forge statements on the web. If the results are not properly audited they are worthless. I could post a start statement and an end statement that shows I doubled my account in X times, and it proves nothing. At least some of the market wizards had their accounts audited and can prove what their real returns are. None of them come close to 30% a month, not even remotely. My argument stands on its own. You dont have to believe that I make nice returns to accept it. Thats the point. Forget I said it. In fact, to help the debate along, ill claim I lose 50% of my equity a year. Hows that? Now lets get back to the issue. Lack of evidence.

I guess some people still cling to fantasies that they can trade orders of magnitute better than the market wizards. Once again, I think ill be waiting a very long time for any real proof. Not hearsay, not so and so made 30% in month a couple of times here and there, not someone bet the farm and and got lucky, real , consistent 30% avg returns a month in many types of markets over a significant period of time.

Waiting for the evidence. There still is none. Zippo. Nada.
Sorry to burst trader fantasy bubbles.

Longshot. I see you are of the "I've been trading a long time and I know best club"

Tell you what,you have had " some very nice returns" why not start the ball rolling and post your Statements?

Not keen? I wonder why? then don't ask others to do the same.

ps, who mentioned forex? I said ym. and Tony Oz was making those returns by going long after the internet bubble had burst and was on the way down. Have you read the book? I have and have a signed copy here, its very expensive now so doubt if you can get a copy anyway.

 

[schoe]

Longshot what you fail to understand is just because you don't know anyone making those returns doesn't mean its not possible.

If you were making that sort of money you would want to keep it quiet wouldn't you? Why? Because as soon as everyone knew you would get the begging letters and be inundated with emails from the 90% asking how etc.

Why would you post your audited returns over several years you have nothing to prove to anyone you are successful and doing very well you want to keep your methods quiet. The last thing you would want is to be in a book like Market Wizards! I agree once you get a very large account your returns will diminish.

I don't know if Tony Oz is a billionaire or not he may be but why would he tell me or you or anyone. I do know he made 56 % during a one month challenge as he details every trade on a 50k account. Zanger made an incredible 29,000 audited 12 month return swing trading but his was in the internet boom years and he will not be making so much now but that is a lot of 30'% s !

All I am trying to say is that you should not have a "it can't be done attitude" just because you do not know of anyone who has done it. Thats what everybody thought about the 4 minute mile now its commonplace.

 

[mr.marcus]

........

 

[Vorpal]

With sufficient gearing you could make 30% returns per month regulaly provided you withdrew your profits regularly, returning your capital sum to its initial level.

30% compounded returns consistently, year after year.....utter rubbish!

Rgds.

 

[schoe]

With sufficient gearing you could make 30% returns per month regulaly provided you withdrew your profits regularly, returning your capital sum to its initial level.

30% compounded returns consistently, year after year.....utter rubbish!

Rgds.

Thanks Vorpal, Exactly what I was trying to say. You can only do it on smaller accounts before size becomes an issue but you just take out the capital and invest it elsewhere and diversify.

 

[fastnet]

Roberto - I was questioning 30% per year - I think 30% per month on a compounded basis is laughable for the reasons stated above. However I don't think anyone is really claiming this is possible - anyone with a GCSE in maths anyway. Rather I imagine they are arguing that it is perfectly possible to make 30% on yr account SOME months. We have all done this surely especially those of us who started out with a £500 Finspreads account ;-)

But this takes us away from the crux of the thread which was: how much capital do you need to live on? Come on - be realistic. You have a decent job that you can do with your eyes shut - the cash comes in every month. What would you need in yr trading account to give it all up and trade for a living? Bear in mind that IF you have a 30% drawdown i/o of a gain you would have to make 50% the next month to make it back. If instead you lost 30% again then you would have to make 100% the following month just to get back to your original bank. . . . .

Is this any way to start your new endeavour - could you really live with the possibility of these drawdown and the inevitable extra risk required just to stand still? Is this treating trading as a business?

 

[longshot666]

Need I point out again that no one has provided any evidence yet?

It's possible that someone has built a home made spacecraft that can fly at nearly speed of light, and has already explored the solar system but just doesnt want to tell anyone. And yeah they have stealth technology too. Its certainly "possible"

Its "possible" ive made a trillion dollars in forex, but just dont feel like showing you my statements because I dont want people to know. Ignore the fact that the tax agencies would know.

A lot of ridiculous things are technially "possible", but until someone provides any evidence to support such claims, they will stay firmly in the realm of highly unprobable, which is a much better synonym for "possible".

Zanger has suffered some pretty terrifying drawdowns as well. If enough people like Zanger bet huge, with virtually no moneymanagement during the biggest bubble of all time, you will certainly end up with a couple of people like Zanger who are on the end of the luck bell curve.

Care to wager that zanger does not make 30% a month over the course of several years?
Care to wager that tony on does not make 30% a month over a course of several years?

One market + wild gambling does not equal consistent 30%/month returns.

Im not saying it cant be done technically. Im saying its highly highly improbable and that there is a big fat **ZERO*** set of evidence that exists today to support it. Its simply not rational to believe that it has ever been done consistently and the fact that there is no record that anyone has come close, should lead you to believe that its highly improbable.

In fact, there are many hedge funds who do want the world to know what their returns are. The more capital they can attract the more fee's the manager collects. Here are teams of phds, math wizards, traders and programmers who all word together to find the biggest consistent return and completely wish to make it as public as possible because it makes them more money to do so.

How many of these funds have come forward to advertise a consistent 30% a month return? NADA.
So your theory that people dont wish to advertise doesnt hold much water. There is a large group of fulltime sophisticated traders who want to do exactly that and have the best resources and access to data and intellectual ability to do just that. Yet they dont produce 30% a month. Hmmmm....why?


Here is another angle on it:
A lottery winner makes %1,000,000,000% return on their equity. What does it tell us? Nothing.

Longshot what you fail to understand is just because you don't know anyone making those returns doesn't mean its not possible.

If you were making that sort of money you would want to keep it quiet wouldn't you? Why? Because as soon as everyone knew you would get the begging letters and be inundated with emails from the 90% asking how etc.

Why would you post your audited returns over several years you have nothing to prove to anyone you are successful and doing very well you want to keep your methods quiet. The last thing you would want is to be in a book like Market Wizards! I agree once you get a very large account your returns will diminish.

I don't know if Tony Oz is a billionaire or not he may be but why would he tell me or you or anyone. I do know he made 56 % during a one month challenge as he details every trade on a 50k account. Zanger made an incredible 29,000 audited 12 month return swing trading but his was in the internet boom years and he will not be making so much now but that is a lot of 30'% s !

All I am trying to say is that you should not have a "it can't be done attitude" just because you do not know of anyone who has done it. Thats what everybody thought about the 4 minute mile now its commonplace.

 

[longshot666]

"dont you just love these sad ole has beens...nuff said"

Dont you love these people who make claims about people they know absolutely nothing about?
What is your evidence that im an "old has been"?? Hmmm?? Exactly. Speaking from ignorance.


" ...and a little more for luck...by youre cynicism you obviously fell well short of youre intended trading goals over the years..."

Once again, what is your evidence of this? You can read my mind perhaps? Its obvious right?
Once again, speaking purely from ignorance.


"dont expect everyone to not reach higher levels than youre mighty self...every thread theres always the obligatory "ive been around the bloke more times than you sonny"...old s*d.. "

Now you know what "level" I have reached for? A mind reader perhaps?
Once again arguing from ignorance.

Come back when you can actually support any of your statements.

 

[mr.marcus]

.......

 

[schoe]

Longshot. Are you on drugs, i've never heard so much incessant rambling in my life.

Yes Zanger did have some big drawdowns in fact at one stage he lost all of his money then guess what he did it again and made several million more. . That must be really lucky!

Hedge fund managers are limited by what everyone is trying to tell you, SIZE and the need to diversify.

This thread is utterly pointless nobody is going to produce any Statements to prove they are great traders why should they?

 

[longshot666]

There is large number of professional traders who are absolutely driven to share their wonderful results, and yet they dont exist. The point is, no one has ever proven such consistent returns have ever existed, and yet people continue with their wishful thinking. There are plenty of traders who get audited to prove they have great returns to attract more money. Yes I believe audited returns, not anonymous statements posted on the internet. Still waiting for any evidence....waiting...waiting...

....hook line and sinker baby....mr predictable...hehe.....you already stated that you wont believe any one even if they produce a statement so what exactly is the point to youre challenge...chill baby....let the pain out cheers mark j

 

[longshot666]

"

Longshot. Are you on drugs, i've never heard so much incessant rambling in my life. "

When you disagree with someone, attack them instead of their position.

" Yes Zanger did have some big drawdowns in fact at one stage he lost all of his money then guess what he did it again and made several million more. . That must be really lucky! "

Dan has some real skill and very poor money management. He goes in huge on single positions. This fails the 30% consistent return challenge. He hasnt done it. He got lucky with a style + reckless betting + the perfect market for that style, and found himself on one end of the bell curve. Take a good trading system and add tons of leverage and you will also get incridble wild swings and big returns (if you dont blow out, which you will eventually)

But can he do this consistently? Nope.


" Hedge fund managers are limited by what everyone is trying to tell you, SIZE and the need to diversify. "
Size issues in FOREX? Yeah right.
Size issues in ES? Right.
This is obviously not true for all hedge fund managers, it depends on their instrument of choice.
Isnt it interesting that with several instruments available with virtually unlimited liquidiy, no one has ever produce returns remotely like 30% a month consistently???

If you wish to claim that SIZE was their problem, then show me a fund manager that was getting 30% return a month, which then "slowed down" as they hit "size" issues a few years down the line after magnificent returns.
Anyone? anyone? Didnt think so.


" This thread is utterly pointless nobody is going to produce any Statements to prove they are great traders why should they?"

Already addressed. There are tons of money managers who want to do just that, and yet, they dont produce such results.

Still waiting for evidence...waiting...waiting...waiting....


This thread is not pointless. Its a dose of reality that many new traders need to swallow.


Of course, im just rambling, since no one seems to be able to provide any evidence. Personal attacks instead of evidence. That should tell you something.

 

[anley]

It's a proven fact that the majority of businesses fail because they're undercapitalised, and it's the same with trading.

In my experience you need at least £100k to do this job correctly, ie as your living. £50k in your trading account and £50k outside the market that you can draw on for bills/living etc.

Try it on less and you're pretty much doomed to failure. Of course there are always exceptions to the rule.

And also from experience I'd say if you do have £100k then you're better off buying a normal business (or setting one up) and trying to grow and expand it. Easier money, easier work, less stress etc, but of course far less sexy because then you have to tell you friends (and potential lady friends) that you're a shopkeeper or a software engineer rather than a...........TRADER!

 

[anley]

And for those of you that seem to think 30% a month is achievable I only have one thing to say;

IT'S ABOUT TIME YOU GAVE UP THE CRACK...........

 

[longshot666]

A well reasoned response. More reality that will get you in hot water. People get upset when you throw the cold chilling water of reality on their trading fantasies.

I would even say that 100K is a low estimate for most people. Lets face it, if around 90% of money managers cant beat the market over the long run, and the market (S&P500 for example) only returns about 9-11% a year, then what can we conclude? Most people will make less than 10K a year with 100K trading account. Sure you can live off of that?

For most people, I would say you need 300K to start with if you wish to stack the deck in your favor.

It's a proven fact that the majority of businesses fail because they're undercapitalised, and it's the same with trading.

In my experience you need at least £100k to do this job correctly, ie as your living. £50k in your trading account and £50k outside the market that you can draw on for bills/living etc.

Try it on less and you're pretty much doomed to failure. Of course there are always exceptions to the rule.

And also from experience I'd say if you do have £100k then you're better off buying a normal business (or setting one up) and trying to grow and expand it. Easier money, easier work, less stress etc, but of course far less sexy because then you have to tell you friends (and potential lady friends) that you're a shopkeeper or a software engineer rather than a...........TRADER!

 

[schoe]

300 K ? Good job nobody told most successful traders that or nobody would ever attempt it !

Longshot I wondered why you suddenly appeared and started trying to stir things up I see you have been banned from Elitetrader!


No surprises there then.

 

[longshot666]

More personal attacks, at least you are consistent.
Im not the longshot on elite trader, since im not on elite trader. That site is just a bunch of 24/7 flame wars. There is a "longshot" on this board, maybe that is him?


Also, im not saying you shouldnt trade if you dont have 300K, im simply pointing out the fact that if you think you can do as well as professional full time money managers, then you can expect to only make 30K a year with a 300K account, which I would call the bare minimum to live on.


Are you ever going to address any of the issues like a complete lack of evidence for these ridiculous claims, or are you going to continue to prove you have no case with more personal attacks?

300 K ? Good job nobody told most successful traders that or nobody would ever attempt it !

Longshot I wondered why you suddenly appeared and started trying to stir things up I see you have been banned from Elitetrader!


No surprises there then.