Sprint Vs Marathon Mindset when it comes to Money
http://www.youngadultmoney.com/2015/10/07/sprint-vs-marathon-mindset-money/
Nice article
How much do day traders make
- Thread starter newdog
- Start date
Nice article
1% return each day?
Starting with 1k account, you become Billionaire in less than 6 year if you compound your return.
You must be one of the anonymous billionaire in ET.
Btw, why you still collect the social welfare check to fund your forex micro account with bucket shop?
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hahahahahahaha
1% per day in day trading on options is not a big deal. Real challenge is "consistency".
While manual trading, becoming billionaire may not be possible as there is a limit to the investment based on the volume of the script being traded beyond which compounding stops and settles to a standard kind of income. And I am not sure about the efficiency of automated trading when compared to manual trading.
Gotta work bucket shop into every post?
I always have problems with this kind of statements as there is a lot of essential information missing to make this conclusion a correct one. The statement starts from the conclusion and manipulates the information backwards to arrive at the pre-defined conclusion.
Some of the many missing things:
- What is he trading? If he trades the ES he will need each time enough profit to add 1 contract on margin. Suppose the margin he uses is 1K, then he will need to trade 100 days before he can add 1 contract. But you probable calculate a compounding rate of 1% each day which leads to $2,704.81 whereas reality will be only $2,000. SO after 100 days there is already a big mistake in your calculation. Continue this error for 6 years and the difference between theoretical return and reality is huge.
- When reaching 1 billion he should trade 1 million contracts at a time if he does 1 trade a day. Will this be possible? Even trading 10% of that, so 100,000 contracts will be a problem. Which broker will accept this kind of position and if you find one, what will be the margin he requires? Surely not 1K.
- Maybe he is not interested in eternal compounding and is happy with daily 100-500 contract positions. In that case he will indeed make 1% a day but never be a billionaire. So your conclusion is not correct in this case.
- Renaissance Technologies has a much smaller return than 1% a day and they refused already many years ago new clients and made huge cash payments to lower the amount of money they trade. They were not able to manage the money anymore. Although they are trading 24/7 all the markets in the world with a team of dozens of traders. So even for them your compounded return logic makes no sense.
I make more than 1% average a day, consistently and over a long period of time. But I am not a billionaire and will never be one as I limit the amount of money, and the time spend, that I use for trading. According to you that is impossible because by definition I should be a billionaire. Reality is not black or white. There are many grades of gray between these two extremes. Many parameters can change and result in a totally different outcome.
I do agree that making consistent profits is not easy, but a bit of honesty would not harm a real correct discussion. And indeed, don't believe everything what people post here. Do some critical thinking.
His point is that you'd be insanely rich in 6 years' time compounding 1% daily, even if you haven't made a billion dollars by then.
Nobody can make 1% daily without fail, not even renaissance tech, this is why they have years in which they "only" made ~20%. There will be bad days, weeks and even years where even the best traders make very little money or a loss.
First read correctly what I wrote. You clearly don't understand (or don't want to) my posting.
You need much more information to make a statement that is valid. I named some of the missing parameters.
I will give you a very simple example:
- X daytrades the ES.
- X trades 20 contracts and makes more than 1% every day ON AVERAGE, so not every day 1%, but the final result after 1 year averages more than 1% per day. So about 250-300% a year.
- X always trades 20 contracts, so NO COMPOUNDING. That's his free choice.
- X makes 1% ON AVERAGE which means that he makes 10$ per day per contract (1% on 1k margin). So he makes less then 1 TICK a day. That is impossible for you???
- X will never be rich, although X does make average more than 1% a day. That proofs that your statement is wrong.
Don't compare daytrading 20 contracts with Renaissance. It is normal that they can not make the return a small daytrader can make on a small position.
Show me the complete detailed calculation of how rich I should be if I say that I make 1% a day on average. I will then show you all the mistakes you made in your calculation.
Let me guess: you will not show these detailed calculations? Proof your statement and I will proof that it is wrong. Should not be difficult.
1% per day in day trading on options is not a big deal. Real challenge is "consistency".
While manual trading, becoming billionaire may not be possible as there is a limit to the investment based on the volume of the script being traded beyond which compounding stops and settles to a standard kind of income. And I am not sure about the efficiency of automated trading when compared to manual trading.
You can ...relatively...easily make much more than 1% a day with options
...that's being very modest.I don't want to throw any numbers around..because some may start to claim I'm full of stuff. and why i'm not a Billionaire yet yadda yadda with a perfect storm of compounding.
I personally don't have to be rich. I live very modestly and simple and frugal.
If I can make a certain amount daily/weekly/monthly/yearly that I don't have to work a regular job...I'm the happiest man on earth.
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