Educate me. I thought 50% a year was good

illiquid,

Do you find that the Current Currency Ranges and volatilities have matured, compared to earlier 20Y historys of one long continuos trend?

What I mean is that we have seen the highs and the lows and can trade contracted between them for a long enough time to plan survival.

As always your most excellent observations are appreciated.

Michael B.
 
Quote from MacroEvent:

Vhehn---------- the 50% number is very relative, as I can say 50% of $10,000 in a year is very doable. Now 50% return with 25 million is a very different target. I agree that hitting 50% a year with an account size of 1 million plus would very well be in the top 1%. I guess I was surprised how they are actually out shopping for systems so actively to dump money in, and that 30/10 was the benchmark----------this gives me the impression what they currently have is a bunch of 15/10 systems right now.
More...

A lot of the return is strategy dependent.

Especially in today's environment, 15/10 for a hedge fund book (say
around 1-10M) would be considered respectable. In fact, a friend's
convertible arb fund made 2%
for the year, and was considered
to be impressive by some pension
funds. As the convert market is practically dry at this moment.

On the other hand, if you were trading, say futures, if you made 30% annually
between 2002 - 2003, that is not considered a big deal, as most CTAs
have done very well.

It is not just size of the account, but also return volatility measured by
Sharpe ratio, and correlation to benchmarks. Show me any Sharpe
ratio of > 1.5, even with a 50k account, over 6 months, I am impressed.
 
There is usually not a steady state value for what you are asking about.

People follow paths as investors and traders. This means that performance is a continuing upward perfomance achievement unless you sidetrack yourself by making the wrong choice. Then you get stopped out on being able to do better.

There are basically 8 decisions that can be made in an investment life cycle. As you can see in the attached going pro early on is a deadend simply because of how it all works. When you are rich it is a last resort that you have to go to.

I have had to do that over and over, but I did not go into an investment type business because investment businesses cannot be placed in the optimum business growth paradigm.

I attached the 8 Q's and the paths that people go along toeither complete achieving their potential or to get parked at one level or another. You can read the posts here to observe where the various posters got stuck. This place that they are in also tells you how far short of the mark they fell relative to the actual potential that is available.
 

Attachments

Grob,

Rather insigtful. It seems I will need to deal with compounding, and overcome a "too early" withdrawal of profits to grow and realize full potential. Being able to fit OPM with all of this and your flow chart, adds a dimension of perspective, Thanks.

Michael B.


Quote from Grob109:

There is usually not a steady state value for what you are asking about.

People follow paths as investors and traders. This means that performance is a continuing upward perfomance achievement unless you sidetrack yourself by making the wrong choice. Then you get stopped out on being able to do better.

There are basically 8 decisions that can be made in an investment life cycle. As you can see in the attached going pro early on is a deadend simply because of how it all works. When you are rich it is a last resort that you have to go to.

I have had to do that over and over, but I did not go into an investment type business because investment businesses cannot be placed in the optimum business growth paradigm.

I attached the 8 Q's and the paths that people go along toeither complete achieving their potential or to get parked at one level or another. You can read the posts here to observe where the various posters got stuck. This place that they are in also tells you how far short of the mark they fell relative to the actual potential that is available.
More...
 
Quote from rufus_4000:

The main point is "consistent", try computing the Sharpe Ratio
(or Sortino) on your periodical returns. Anything > 0.5 can be considered
pretty good, anything > 1.5 is fantastic, I have never seen anything > 2.5
that is credible.

The best I have ever seen (not mine, not even close), is around 250%
annualized net return for 2 years (and counting), all verifiable at the clearing
firm, and tracking sharpe ratio of around 1.7. There are literally
investment banks calling him every day to put money with him, and this fellow
just turns them all down. Unbelievable.
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How large was this fund at the beginning of the 2 year period?

Electricsavant, I have read somewhere that if you start a fund and you have a drawdown of >5% in any month within the first year, it's over in terms of raising money from fund of funds. obviously if you have other types of investors who are willing to stick with you it's a different story.
 
I enjoyed this. Just re-read the thread. I needed a chuckle tonight. There actualy is some good stuff in here...

Michael B.


If you want to join a club, try Kiwanis, Moose or Knights of Columbus.
 
Quote from jerryz:

How large was this fund at the beginning of the 2 year period?

Electricsavant, I have read somewhere that if you start a fund and you have a drawdown of >5% in any month within the first year, it's over in terms of raising money from fund of funds. obviously if you have other types of investors who are willing to stick with you it's a different story.
More...

This person is not a hedge fund, but a strictly proprietary investment pool,
mostly his own and *maybe* family money. I just know him, not that well.
Obviously this person is incredibly secretive, you will never catch him
talk about trading, ever.

I believe he started with around $3-4M, and now has >$15M (20?), from what
I saw, the most draw down month he lost < 1-2% (probably less).

If a startup hedge fund loses more than 5% in a month, then it will be
perceived that they are not risk managing properly, and most
pension funds or fund of funds will lose interest immediately. Managing money
is quite different from trading for your own account, you should beat certain
benchmark. One fund of fund that I know, any hedge will be tossed if they
are not within 20% of a benchmark for two consecutive quarters.
 
Not enough. 5k in Forex.

Do you realize that 100k would net me a about 7k/yr. if I traded opm at 2/20. The invester would make 25k-7k= 18k/yr. and not see more that an 8% unrealized DD. Plus I could still trade my own money.

Sheesh a HF could let me trade just 10% of their pool and I would be a millionaire..Trading my own money would take a few years to make millions, I want to do it now.

I am small time, looking to supercharge my career. Big numbers do not bother me, not that I do not respect money.

I have an institutional version of my system just made for the conservative approach to trading. For more information read that thread I posted in the beginning of this Thread.

Michael B.


Quote from jerryz:

Electricsavant, how much capital do you have?
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