Advice on how to make 5%/month on $1 million

Sure.

1) open a portfolio margin account
2) go long your top 20 best high dividend payers/dividend growers and short spx— you need to be beta neutral
3) this will allow you to lever up 4-8x (so your $1MM is now $8MM of assets)
4) spend each morning using excess cash to hedge out both market and security risk (buy puts based upon your daily value at risk); takes 1-2 hours
5) spend 2-4 hours weekly checking your companies & reviewing potential additions

If you do this right, you can target an annualized yield of 6-8% on $8MM of capital paying 1% in margin. That translates into 40-50k/mo, which is close to 5% on $1MM.
 
kmiklas said:
This is a 60% annualized return.

If you can consistently get this, start a hedge fund.
More...


What if having customers (aka bosses) and being governed by governmental regulations are not something he's interested in?

Honestly, you folks that compare a nimble, personal, none-to-little-red-tape trading operation to a multi-million/billion/trillion fully regulated, global, customer-oriented operation are just stuck in your own short-comings.
 
If you can get 5% per month or 60% per year, you are even a better trader than those hedge fund managers featured on Market Wizards like Ed Seykota, Paul Tudor Jones, Steven Cohen among others. Steven Cohen has had years where he earned $1 billion from trading. The best hedge funds will get 28% at times, not every single year and there are losing years too. Hell, you would be as good a Bernie Madoff who claims to have placed 77 straight trades without a single loser? You are looking at returns that are out of planet earth. Realistic returns can be attained, pipe dreams will remain just that, pipe dreams.
 
Advice on how to make 5%/month on $1 million...
Do the difficult first, ... disassociate reward from effort.
Then ...
Buy and Hodl Bitcoin.
Peel off your 5% a month if you must.
blaze1635 said:
Would like to get some feedback on the following "not so hypothetical".

Consider the following constraints:
- U.S.-based brokerage account with $1 million in cash
- monthly target of 5%/month; this will be withdrawn, so account won't grow
- max trade limit of 50 trades/month
- ideally no more than 2-3 hours/day of watching/trading markets
- lowest risk to achieve the 5%; in other words, would rather have less risk than a return greater than 5%

How would you approach this?
what markets/instruments?
what trade sizes?
where to place stops and limits?
other thoughts?

Thank you for your time.
More...
 
Last edited:
blaze1635 said:
Would like to get some feedback on the following "not so hypothetical".

Consider the following constraints:
- U.S.-based brokerage account with $1 million in cash
- monthly target of 5%/month; this will be withdrawn, so account won't grow
- max trade limit of 50 trades/month
- ideally no more than 2-3 hours/day of watching/trading markets
- lowest risk to achieve the 5%; in other words, would rather have less risk than a return greater than 5%

How would you approach this?
what markets/instruments?
what trade sizes?
where to place stops and limits?
other thoughts?

Thank you for your time.
More...


Nobody worth seven figures would ask this question unless they recently fell into the money.
 
longandshort said:
Sure.

1) open a portfolio margin account
2) go long your top 20 best high dividend payers/dividend growers and short spx— you need to be beta neutral
3) this will allow you to lever up 4-8x (so your $1MM is now $8MM of assets)
4) spend each morning using excess cash to hedge out both market and security risk (buy puts based upon your daily value at risk); takes 1-2 hours
5) spend 2-4 hours weekly checking your companies & reviewing potential additions

If you do this right, you can target an annualized yield of 6-8% on $8MM of capital paying 1% in margin. That translates into 40-50k/mo, which is close to 5% on $1MM.
More...
Are you doing this? If no, why not?
 
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