Compounding Interest Rates

[Grob109]

ES the average in ET is a point a day in profits.

I use 2000 bucks as capital for making 50 bucks.

How long to double money?

It is not compounding, though is it.

40 days

How about using 500 as capital requirement?

10 days.

So you add a contract after 10 days

Then you double again in 10 days to have 4 contracts

8 contracts in ten more days after that.

What would it look like if you were using maths to determine how fast it really grows???

How do people making the average of 1 point a day per contract do this kind of math???

Obvoiusly everyone in ES who is getting the average of 1 point a day per contract is in clover after a while.


So why not cut down the time to make that 1 point a day????


Four swings in a day of 1 point are seen just about every day.

Why not do a couple more?

Maybe there are 20 to 40 trading actions a day in ES. If they all are unrelated thats 10 to 20 trades.

Say each is half a point.

With minimum of 10 trades at half a point it looks like you make a contract margin every day for every contract.

There's something wrong here I guess.

Lets go back to 5 or 6 percent a year and be real.

 

[PitchBlack]

Quote from Grob109:

ES the average in ET is a point a day in profits.

I use 2000 bucks as capital for making 50 bucks.

How long to double money?

It is not compounding, though is it.

40 days

How about using 500 as capital requirement?

10 days.

So you add a contract after 10 days

Then you double again in 10 days to have 4 contracts

8 contracts in ten more days after that.

What would it look like if you were using maths to determine how fast it really grows???

How do people making the average of 1 point a day per contract do this kind of math???

obviously everyone in ES who is getting the average of 1 point a day per contract is in clover after a while.


So why not cut down the time to make that 1 point a day????


Four swings in a day of 1 point are seen just about every day.

Why not do a couple more?

Maybe there are 20 to 40 trading actions a day in ES. If they all are unrelated thats 10 to 20 trades.

Say each is half a point.

With minimum of 10 trades at half a point it looks like you make a contract margin every day for every contract.

There's something wrong here I guess.

Lets go back to 5 or 6 percent a year and be real.

Indeed, There's something wrong here I guess. And then i mean with your posting.

You make a 1% a week into a two digit return a day. And afterwards you use that return to say that we have to return to reality.
Speaking about objective and sensible postings.

If you only make 5 or 6% a year you're an idiot to trade.

I think it is better to post from now on that making profit is impossible, that all traders lose money and that this forum is just a place where losers meet to heal each other and to make it easier for the mind to accept that we are all losers.

negativism rules this site.

 

[drsteph]

Quote from Ripley:

Lets change the numbers and find out.

If you are between 30 and 40, would you invest 1,000,000 for 30 years at 10% (historical stock market returns) and have 17.5 million when you are between 60 and 70 years old.

I would contend that you can get better "returns" without investing your million.


It is assumed that the investor in question is an astute investor, 10% returns are after tax, and 1 million is all the savings.

Would you do it? Would you give up your 1 million and all the joys it could bring today, for 17 million in 30 years?

If you have $2 million, and a little self restraint, the chance to leave a legacy to your children of that magnitude is absolutely worth the opportunity cost.

 

[Grob109]

Quote from spike500:

Indeed, There's something wrong here I guess. And then i mean with your posting.

You make a 1% a week into a two digit return a day. And afterwards you use that return to say that we have to return to reality.
Speaking about objective and sensible postings.

If you only make 5 or 6% a year you're an idiot to trade.

I think it is better to post from now on that making profit is impossible, that all traders lose money and that this forum is just a place where losers meet to heal each other and to make it easier for the mind to accept that we are all losers.

negativism rules this site.

Trading equities ultimately is where a person lays off surplus profits in trading the leveraged index markets. Here think in terms of 6 to 8 day cycles pulling down half the potential of a 20% swing trade. Do a couple a month part time. Here you double about once every 4 to 8 months independant of input from commodities.

Markets profits in index trading are limited; getting excellent timing on trades is best done by keeping the number of contracts reasonable. As the various levels of liquidity shift across the trading day, you just have to be satisfied with moving only so many contracts as certain times of the day. This means you should sweep your capital out every once in a while to get the surplus back to work again. Using surpluses from this effort for living will not get rid of all the surpluses; they still mostly go to equities.

There is the matter of using profits to pay yourself for living and life style needs. And taxes. Pay yourelf whenever and as much as is convenient. Taxes take care of themselves according to regs your accountant handles. Send the checks just in time.

The whole thing you do with money is mostly compounding as you grow wealth.