AriaS
Well-known member
- Messages
- 398
- Likes
- 124
The question is about the higher end of realistically sustainable risk-adjusted return over at least 5 years.
No one cares about return alone.
(+100% / DD70%) = (+28% / DD20%): that's the majority of tracked accounts on Forex Factory, as an example.
Pretty sad.
Let's say:
Maximum drawdown: 20%
After costs, before taxes.
CAGR: ?
Monthly return: ?
P.S. As long as a trader knows how to stay a safe distance away from forced liquidation / complete loss, I don’t judge their drawdowns. For example, equivalents to my answer: +120% / DD40% or +150% / 50%. Risk should be determined by personal risk tolerance and the nature of the account.
No one cares about return alone.
(+100% / DD70%) = (+28% / DD20%): that's the majority of tracked accounts on Forex Factory, as an example.
Pretty sad.
Let's say:
Maximum drawdown: 20%
After costs, before taxes.
CAGR: ?
Monthly return: ?
My answer:
CAGR: +60%
Monthly return: +4%
If I manage to do that for 5 years, I'll say, "Wow, I am an exceptional trader."
P.S. As long as a trader knows how to stay a safe distance away from forced liquidation / complete loss, I don’t judge their drawdowns. For example, equivalents to my answer: +120% / DD40% or +150% / 50%. Risk should be determined by personal risk tolerance and the nature of the account.
