50-100% monthly returns
- Thread starter fxtradeprodigy
- Start date
Anything is possible, it's at what point is it not possible. Sure one can make XXX% in a given time, but as been pointed out, you'd own the world. So, at some point the market can only digest a certain amount of money, at that point you lower leverage, making less % return.
You should read correctly what was posted earlier. You assume by default eternal compounding although the poster below explicitly said "no compounding for longer then 1 month". You can make 100% every day and never "own the world" by always just trading the same (small) size. You can trade more then 1 commodity and do there the same.
That's why the statement of the bashers "you should be the richest man on earth" is pure nonsense.
First of all, thank you for your insight. It's rare to have winning consistent traders (I'd wager <10%) of posting on here.
Just a note, there's no free lunch since accuracy is a function of R/R. If one is aiming for 5:1 RR the skill is all about where to place a stoploss that doesn't very frequently get blown before enough time has passed for price to meander around to the profit target.
The best takeaway from your post is that reconsidering the R/R of one's trade plan can turn a losing trader into a consistently winning one.
You do realize he's a fraud right? So is everyone else claiming to make this kind of return on any remotely consistent basis. People should have to take a personal finance class and understand compounding interest before trading. If there's one thing this forum has (especially the forex forum) is a significantly high ratio of frauds to actual traders. Don't believe anything without photocopied return papers verified independently by any number of CTA analysts.
Let's assume for argument's sake he does accomplish this feat. Time for a personal finance lesson:
50% return compounded monthly: (1 + 0.5)^12 =129.74633789063 - 1 = ~ 128.7% annual return.
This feat has been accomplished by very few super traders. Of all of the interviews I have read the super traders who've accomplished this aren't consistent. A streak of around 3-4 years is about all you might expect. A person with this talent would be getting interviews on nearly every channel. Books would be written about them. Since our friend didn't name drop themselves we can assume they're lying.
Look at the total return on $25,000:
Year 1 = 25,000 * (1.5)^12 = approx $3,243,658
Year 2 = 3,243,658 * (1.5)^12 = approx $420,852,746
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Are you seeing a pattern? Not only is this kind of trader rare - a consistent 50% monthly return would have them see multiple TRILLIONS of dollars in a matter of a decade or less.
Don't believe any track record posted here. Less than 50% of forex traders turn 1 cent of profit. Even fewer commodities traders do. Do you honestly believe this guy is different? If they're not willing to be verified and post scans of said verification with annual return slips it's safe to assume they're a fraud. These kinds of frauds always have the hallmark "don't believe me I don't care". It's the same bullshit mumbo-jumbo essential oils pyramid schemes use when you question if the $500 you spent on your essential oil kit is really doing anything for your health. These kinds of frauds fall apart under the slightest bit of scrutiny. The "don't believe me I don't care" is a misdirection that is characteristic of a coward and a liar.
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Now wait a minute... That is a totally unfair comparison...Mmmmph
Oh I am very much aware of compounding, I did pay attention in elementary school. Your calculation is off though, it's more like 12875% annual return.
He says he doesn't compound (and nobody with any experience would trade 10x leverage with their entire networth). I don't see how this is a argument meaningful to the discussion given that entirely different strategies work on small volume compared to larger, yet it's been repeated in this thread.
Also, we're at risk of arguing semantics of "consistent" here. With 50% a month you're going to be blowing the account sooner or later. But that's fine if you A) withdrew lots more, and B) have negative balance protection or otherwise together with A not doing aggressive enough leverage to end up with a large deficit on Black Swan.
Your skepticism is entirely justified, but since I've backtested 150% annual return strategies without leverage on short vol for instance (that I didn't dare to trade, and XIV did blow in Feb), it's not really strange to me that high risk leveraged strategies could work for a couple of years if you don't give a damn about the drawdowns that will eventually blow it.
Now, if he is a fraud, it's pretty interesting why he would choose to post this. But w/e, I chose to believe him (sum of impact being a somewhat higher focus on backtesting higher R/R strategies, I've generally stayed away from above 2:1).
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Obviously
That poster disappeared within 2 weeks after registration. Already wiped out?
Your "obvious" is realistic for someone who found a reliable and consistent system.
At the same time it is unachievable for someone who didn't find a reliable and consistent system. And that is reality for the majority.
Watching at the charts it looks doable, real trading confirms that it is not as easy as it looks.
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