Can a single individual annually earn like 70% to over 100% in the long term?

[Alpha Trader]

But how much are you willing to risk to pull out that $.25? What if it is .50 against you?

$0.50!!! :eek: I would be long gone from this world having suffered a heart attack.

I will only risk pennies on any trade. It doesn't take long for me to realize if I am wrong, in which case I will be out without any hesitance.

My top 3 priorities are:

1) Risk management
2) Risk management
3) Risk management

Once I have these in order, the rest takes care of itself; I am VERY selective in taking my setups.

 

[Scataphagos]

You mean less than 10 financial units averaged 40% for 10 years?

Yes.
Fewer than "1 in 1,000" professional money managers averaged 30+%.

The air above 40% was very much thinner.

 

[GloriaBrown]

There is a difference between trading a small amount of capital and trading millions/billions. Could your guy that trades 3 contracts do the same with 300 or 3000? I find that as I go, preserving capital becomes more important and I am willing to risk less and in turn make less.

It is different before HFT exists. It may not be that different when the monster can do HFT while individual cannot. Actually the monster with HFT can trade much faster and earn more with HFT than an individual who cannot do HFT. Also futures, currency market are so liquid now, giants can sell or buy crazy many without creating big waves in high volume days. Long term trading wouldn't be different as well as long as the giant is in big market like S&P 500 ETF instead of normal or penny stocks market.

 

[stock777]

turkeys

 

[ronblack]

yes, but the chances are less than those of winning a lottery jackpot.

 

[murray t turtle]

I think the highest annual return in long run that is known by public is Medallion Fund by Renaissance Technologies earning 35% after fee(actually it is 80% if we don't count fee)for around 25 years.
http://en.wikipedia.org/wiki/Renaissance_Technologies
Here is a news shows it is around 80%:
http://www.bloomberg.com/news/2013-...o-shield-profit-from-taxes-draws-irs-ire.html
Its flagship Medallion fund has returned about 80 percent annually before fees since 1988, according to the Bloomberg Billionaires Index.
Another news:
http://www.nasdaq.com/article/how-to-invest-like-the-worlds-most-expensive-hedge-fund-cm269533
Simon's flagship fund, Medallion, requires aminimum investment of several million dollars and charges a 5% management fee and a jaw-dropping 44% performance fee. The fund is closed to new investment and has returned an astounding annual average net of 38% (remember, that's after the high fees). Since its 1988 launch, the fund has lost money in only one year, 1989, which saw a drawdown of 4%.

So there is a guy in a popular local forum claims that he constantly earns over 70% per year. He sound like he keeps improving to over 100%. He only day trade local index future. He buys and sells average around 3 rounds per day, and the index is just normal 9am to 4pm kind of trading hours but not like US future 24 hours a day kind. He uses IB to automatic the day trade process. Base on what he showed before, his way is trend following, and somehow he can get in the trend very early and leave at right timing. He uses second as time frame unit to do analysis.

He definitely sounds like he knows what he is doing and he knows how to use IB well. He is a full time trader and gave up a good financial job to do that. He has a lot of professional financial qualification.

For other giant famous hedge fund, I find out the average performance over long term is not more than 15% per years:
http://www.hedgefundintelligence.co...-Years-of-Absolute-Return-Top-10-of-2013.html

Personally I don't believe any human can constantly beat or even come close to the 80% mark of Medallion by himself. Since all those big hedge fund other than Medallion Fund can only make 15% the most, while there are so many hedge fund making much worse, I expect a very outstanding individual can only earning around 20% or the most 30% in long run.

What do you think?

%%%%%%%%%%%%%%%%%%%%%%%%%%%
Thanks, GloriBrown;
that sounds like a truthful article, not that wikipedia[where any can post, any-
time],,is the best source.

Actually they did much better in an 11 year period, assuming that article is truth, i assume it is truth ; but its 275 employees.Plenty,plenty , plenty of money managers dont beat the S&P 500 benchmark [that is usually about 11%/+]for 10 year period...........................................

Also sure its posssible to earn that %% you asked; as far as probable,,long term,, that IS another matter, for sure. Not a prediction, as i usually write that; ''not a prediction''
Also, its much easier to risk more when young; that way one may have time make up for it if one loses big.Thanks+ like Winston Churchill said '' that's a socialist idea that profits are a vice '',LOL.......................................................................................................................................................................................................................................

 

[GloriaBrown]

%%%%%%%%%%%%%%%%%%%%%%%%%%%
Thanks, GloriBrown;
that sounds like a truthful article, not that wikipedia[where any can post, any-
time],,is the best source.

Actually they did much better in an 11 year period, assuming that article is truth, i assume it is truth ; but its 275 employees.Plenty,plenty , plenty of money managers dont beat the S&P 500 benchmark [that is usually about 11%/+]for 10 year period...........................................

Also sure its posssible to earn that %% you asked; as far as probable,,long term,, that IS another matter, for sure. Not a prediction, as i usually write that; ''not a prediction''
Also, its much easier to risk more when young; that way one may have time make up for it if one loses big.Thanks+ like Winston Churchill said '' that's a socialist idea that profits are a vice '',LOL.......................................................................................................................................................................................................................................

This is not fair if we compare to index like this. Country can go through a very bad economic cycle and bad for few decades like Japan.

 

[xelite777]

To make 250% a year like you suggested, you need to win 1,000 times in a row (4 trades/day x 250 days = 1000 consecutive winning trades).

In other words, you are assuming that your profit target will be reached 100% of the time without triggering any stop.

Please stop dreaming.

Let's run the numbers.

If you have $100k pool capital, 1% of that is $1000. If you are trading equities that range between $25-50, you can hold 2-4 positions at any one time. Holding 4 positions of 1000 shares (2 x $25 x 1000 shares = $100k pool capital) requires you to pull out only $0.25/trade to make $1000 (or 1% of the pool capital)/day.

If one is a decent trader, many more than 4 positions can be had during the trading day. If successfully done, with keeping losses as small as possible, you can end up making 250%/year (1% return/day x 252 trading days/year). Of course commissions, fees, taxes etc may bring this down a little, but that shouldn't throw it too far.

 

[Alpha Trader]

in a row (4 trades/day x 250 days = 1000 consecutive winning trades).

Who ever mentioned "in a row" or "consecutive"? Did you miss the part in my comment that said "with keeping losses as small as possible"?

In other words, you are assuming that your profit target will be reached 100% of the time without triggering any stop.

There are no assumptions in trading; it's either there or it's not. The trade doesn't always have to reach your target. Sometimes you have to take what the market gives you. It's called trade management. Also, I do not use hard stops, unless I move away from the screen.

Please stop dreaming.

It's very real my friend. As @stock777 would say: Those that know ain't saying, and those saying don't know.

 

[xelite777]

Who ever mentioned "in a row" or "consecutive"? Did you miss the part in my comment that said "with keeping losses as small as possible"?

Reread your post, it is hysterically funny.

You are basically saying it's easy to make 250% a year, the trader "just" needs to make 1% profit per day. Piece of cake.

It's like saying "Hey, it's easy to make over a billion dollars a year, just earn 3 millions a day!"


Listen, if a trader could "just" make 2% a month consistently, he would already be a super trader. So please, forget about making 1% a day average profit year after year, not going to happen.

Not even in the Twilight Zone.