How to evaluate your performance as a trader?

M

maildigger

I swingtrade (long only) the S&P500 by trading SPY. Basicly I try to get in when the markets starts trending and get out when it reverses. These are my results of the past 3 years. Should I be happy with this performance? How can I (objectively) evaluate my performance?


2012 +7.93 points of SPY

4 trades
+6.24
-1.52
+2.56
+0.65

2011 -0.62 points of SPY

4 trades
+1.31
+0.46
-2.29
-0.10

2010 +12.80 points of SPY

4 trades
-2.89
+4.58
+6.23
+4.88
 
Given that you are long long only, it seems you would have been better off not trading and just buy and held over the same period.

Also, do you account for dividends - there's another 7 points you could have realized if you had just buy and held. I bet your holding periods crossed ex-div points.
 
In a market that is going up, buy & hold is hard to outperform.

I try to get some piece of the cake but I want to avoid the big drawdowns that can happen when you choose buy & hold.

How can I tell if my performance is 'good enough' to keep doing it.
 
I think performance benchmark is quite subjective and depends on your expectations from trading. For me "success" is having a profitable month.
 
Quote from maildigger:

In a market that is going up, buy & hold is hard to outperform.

I try to get some piece of the cake but I want to avoid the big drawdowns that can happen when you choose buy & hold.

How can I tell if my performance is 'good enough' to keep doing it.
More...

You are long only so you should be better than the market. If you were doing some kind of market neutral strategy it would be a tough benchmark. But you are saying you are better at picking times to buy and sell than the market.

You didn't outperformed in 2011 when the market was flat (one big rally and then one big selloff). you were flat as well except the market gave you dividends.

dividends and tax events are the hidden costs to trading and they add up. So you should thinka bout that.

I would keep going because you aren't doing badly either. But you should think about some of these things in my opinion.
 
I see my performance weekly and monthly , I calculate what I gain or loose in these days . It helped me to manage my account and do right decision for next trading. I see my capital how much it is grown or less than I invested.
 
There is a direct relation ship between the performance and the result thus obtained. If we are earning some good percentage of income then its an indication that we are performing well at trading.
 
I evaluate my performance on monthly and weekly base. I see what I loose and gain , I make future plan to improve my performance . I can see I am more successful trader than last year . I am now gainer. I loose too in market but my profit s are higher than loss.
 
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