Is it possible to make >=20% expected geometric mean returns per year with options? Why?

lawrence-lugar · Dec 8, 2015

Bry said:
Marty Schwartz has/had a proven and verifiable track record of growing at 20% per MONTH. He would start with $400k and pull out $600k when he reached $1M, repeatedly. Naysayers, naysayers, this guy is real. There are a few olympic gold medalist traders. They probably don't waste their time at elitetrader.com. Schwartz wasn't giving away his secrets.

That's a good, relatively safe strategy/plan, it gets tough...I can imagine...when you pass that threshold in options. Start fresh each month, take your prior profits out.

It's not that difficult to guesstimate MS's strategy, and/or to formulate your own recipe to spit out 20% per month with options.
...hell, if you're more ambitious/crazy/bold/lucky...you can generate much more than that if you want.

Gambit · Dec 8, 2015

lawrence-lugar said:
That's a good, relatively safe strategy/plan, it gets tough...I can imagine...when you pass that threshold in options. Start fresh each month, take your prior profits out.

It's not that difficult to guesstimate MS's strategy, and/or to formulate your own recipe to spit out 20% per month with options.
...hell, if you're more ambitious/crazy/bold/lucky...you can generate much more than that if you want.

If you want to swing for the fences, this is not a bad idea. Marty uses spreads btw. If it works...why not?

jk90029 · Dec 8, 2015

Bry said:
Marty Schwartz has/had a proven and verifiable track record of growing at 20% per MONTH. This is a track record for years, and the most he ever lost in a month was 3-4%. He lost 20% in the crash of '87, and made it all back before the end of that same month!
He didn't compound long term. He would start with $400k and pull out $600k when he reached $1M, repeatedly. Naysayers, naysayers, this guy is real. There are a few olympic gold medalist traders. They probably don't waste their time at elitetrader.com. Schwartz wasn't giving away his secrets.
Some minds learn to become hyper-competent at trading.

Most traders have roughly 40 to 50 years (e.g. 30 to 80) of experience. If you are saying above record for a few years without long term, it is intentional fraud, probably.

For example if his record has annual 50% compounded, then his wealth grows 1.5^50 = 637621500 times, over the 50 years. It is bigger than Buffet and Gates.

Unbelievable the compounding!!!

VTS · Dec 9, 2015

Bry said:
Marty Schwartz has/had a proven and verifiable track record of growing at 20% per MONTH. This is a track record for years, and the most he ever lost in a month was 3-4%. He lost 20% in the crash of '87, and made it all back before the end of that same month!

Not even close, not even remotely close my friend. 20% a month and never lost more than 3-4% except a single month in 87'? This is what you believe his track record shows?

Where do you people get these ideas. It's shocking the amount of crazy distortions there are around the legend of Marty Schwartz. It gets better every year. I can't wait to come back next year and hear about his 50% WEEKLY gains without ever having a losing month.

Trader22 · Dec 9, 2015

Just don't listen to the people on this site that say trading or making a certain % a year is impossible. I laugh at them. You will too one day if you truly spend the time and money learning the game.

Bry · Dec 9, 2015

VTS said:
Not even close, not even remotely close my friend. 20% a month and never lost more than 3-4% except a single month in 87'? This is what you believe his track record shows?

Where do you people get these ideas. It's shocking the amount of crazy distortions there are around the legend of Marty Schwartz. It gets better every year. I can't wait to come back next year and hear about his 50% WEEKLY gains without ever having a losing month.

If someone thinks something is impossible, it is definitely impossible for that someone.

jk90029 · Dec 9, 2015

VTS said:
20% a month and never lost more than 3-4% except a single month in 87'? This is what you believe his track record shows?

For the 20% a month, annual compounding will be 1.2^12 = 8.9161 = 8.9 times(790%)

Therefore for the 10 years it should be 8.9^10 = 3118171993 times.

1) With seed of 10K, he should have 3118171993*10K = 3118171M
2) With seed of 100K, after 10 years he has 31181719M.

Does he?

Probably someone has too much time and nothing to do spend his useless time.
That is why he ignore simple math.

BrandNewTrader · Dec 12, 2015

He didn't claim that Schwartz was compounding his returns. Good traders usually pay attention to details.

lawrence-lugar · Dec 12, 2015

BrandNewTrader said:
He didn't claim that Schwartz was compounding his returns. Good traders usually pay attention to details.

I agree...Compounding your account up to a certain point...and then you take out the profits, and restart.

-- you can't expect to have Bill Gates or Warren Buffet's wealth as an individual trader...there are some limitations.

(or maybe you Can...if you're really Excellent at slowly investing for the really long haul...you can compound your account that way to the moon...but that safe/slow way is terribly boring -- we traders want our aggressive rewards/returns Now.

)

VTS · Dec 15, 2015

BrandNewTrader said:
He didn't claim that Schwartz was compounding his returns. Good traders usually pay attention to details.

And good traders usually also pay attention to facts and truth. I realize there is no shortage of people who repeat audacious claims about what Schwartz did as a trader, but they are just that, claims and stories.

While his record is incredibly impressive, one of the all time greats no doubt about it. His record of course does not come close to the ludicrous claim of 20% a month and only in a single month in 87' did he take a significant loss. That's just silly.

The mans a legend, and his TRUE record should speak for itself. No need to embellish it to the point of insanity.