Liquidity is limited. You will be stuck and you cannot make a 80% return at a certain point due to lack of liquidity. You will then have to retain your position size whilst your account size is expanding, hence, lowering the return in terms of percentage relative to your account size. The return percentage will diminish as your account grows larger.
2018 P/L year to date +40%
- Thread starter VolAlgo1
- Start date
Liquidity is limited. You will be stuck and you cannot make a 80% return at a certain point due to lack of liquidity. You will then have to retain your position size whilst your account size is expanding, hence, lowering the return in terms of percentage relative to your account size. The return percentage will diminish as your account grows larger.
Buffett is also implicitly between 1.5 to 2 times levered on uncorrelated debt with negative interest rates (insurance float). Some academics magically realized that if you adjust SPX returns for that leverage, Buffett's late alpha disappears.
Position closed @$12.26.Loss of $213 on a $10,000 account.
Huh? This was posted well after the close, which was at $11.99. SVXY traded below "$12.26" all afternoon.
At the point Vol can’t make 80% anymore, it’ll be like so what. He’d be swinging so big 10% a year would be the kind of money others still dream of.
Agreed. That is why most broker in most countries lend money to traders with interest of 8% to 12%.
My guess is good and profitable traders cannot outperform the above annual 10% historically, which many brokers learned long time(400 years after Netherland).