Of course it's not. 20% gain on one trade based on 10% allocation per trade = 2% gain on the whole account.
Account starts at 10,000 and becomes 10,200. That's 2% gain on the whole account. Which part is not clear?
Do trading education scammers (99.99% of the "industry") ever feel guilty?
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Account starts at 10,000 and becomes 10,200. That's 2% gain on the whole account. Which part is not clear?
At least we finally agree.
In my opinion, its unnatural to quote a % gain under the PnL column as you do. I realize that perhaps options people do this, but it doesn't make sense given your column header. A PnL number is profit or loss. Profit or loss refers to dollars. It sounds glamorous to say 20% gain, 30% gain, but this amounts to maybe $100, or $200, which is still nice, but not accurate enough, especially since you say that you can't size up.
Furthermore, and more important, a 20% gain on one trade doesn't mean its the same as on another trade since the option price will be different. All of these intricacies are hidden when you use percentages, but this is exactly what a subscription service wants. Show a small account with wins, state it as a percentage, and make the reader assume they can just do 10 times as much and quit their job.
Which takes me back to my original point. You can't quit your job of selling subscriptions because you can't do 10 times as much volume since you already said you're liquidity constrained. You're selling a dream that you haven't mastered.
I have no idea why would you say that.
If I decide to allocate $1,000 per trade, and a spread costs $200, I will buy 5 spreads. I make 20% - that's $40 per spread or $200 for the whole trade. If another spread costs $500, I will buy 2 spreads. I make 20% = $100 per spread or $200 per trade. Different spread prices, but still same dollar gain.
If I increase the account size to 50k and keep the same 10% allocation, same 20% means $1,000 gain. In terms of account growth, it is still 2%. If I record $200 gain, how would you calculate the account growth?
The way we calculate performance is the most honest and transparent way to do it. Some services consider a $500 gain on a $1,000 investment to be a 50% return when the whole account is worth $10,000. We consider this to be a 5% return — and that is the honest way of doing the calculations.
And no, I don't sell dreams. I keep telling my members that trading is hard work that takes time and commitment. If you read some of our articles, you would see it. But then again, your goal is not really finding the truth - it is bashing.
Here is why, taken from your website. Both outlined trades have a roughly 30% gain or loss. In the first example, the 31.3% loss is $251, but the 30.5% gain is $487. So all of these percentage gains or losses don't mean much in comparison to each other. You lost 30% on one trade, and gained 30% on another trade, but because the options were different prices, you're still ahead by $236.
Fortunately you do list the portfolio value so you can at least make some sense of the equity curve but without this, that P/L column is one step above useless.
Yah, I see it is 1.77%. My math was off. Sorry.
Nor even a "she".I do *not* think she is sincere.
No, that's because the 31.3% loss was half position as mentioned in trade description "DE calendar (half)". Some of our trades are 5% and not 10% which is considered half position, for various reasons.
And to answer your next question which I'm sure will come - no, not just losers can be half position, as you can see in NFLX calendar (half) 26.7% gain, VXX diagonal (half) 33.5% gain etc.
What would be useless is recording dollar gain as many services do. If they list $1,000 gain, is it a good gain? Depends on position sizing.
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LOL... I'm done here. At least you note that its half size, but if you think saying 30% is the better way to quote something, regardless of it being $250 or $500 (which actually matters in the real world), then I better leave as I have nothing else to offer.
I'm really surprised that you continue arguing about such basic concept.
Do hedge funds report performance in dollar terms? Ever seen hedge fund (or mutual fund) saying "we make $100M last year"? No, they say "we made 20%". Why? Because a billion fund making $100M is not the same as hundred billion fund making $100M.
At the same time, if I say "we made $8,000 last year", what does it mean? it depends what was the size of our model portfolio. How would you compare two services if one has model portfolio of $10k and another one model portfolio of $100k? If the first service reported gain of $10k and the second one gains of $50k, does it mean the second service has a better performance? No because it made 50%/year while the first service made 100%/year.
Hope it makes sense.