I've put together a trading system, which places about 45 trades a month usually of 2-3 day duration. I started trading it on the Apr. 9th and so far it has generated a profit of $1,444.13 from a $12K margin account. The problem is it only has a win rate of 61.7% and the total gains are $2,760.73 and the total losses are ($1,316.60 ). If I understand right once I have exceeded $3K in losses I will have to pay taxes on total gains thereafter. So just assuming that on Apr. 9th I had already been trading this system 3 mo. and had losses of $3K on Apr. 9th, then for this period if we assume a 30% tax rate on total gains, my after tax profit would be $1,444.13 - (0.3 x $2,760.73) = $615.19, having netted a larger profit for Uncle Sam ($828,22) than for myself.
Please tell me that I am wrong, but if I am not wrong how can anyone possibly hope to someday make a living at this?
Also is there anything I can do to keep uncle Sam from taking most of my profit?
Please tell me that I am wrong, but if I am not wrong how can anyone possibly hope to someday make a living at this?
Also is there anything I can do to keep uncle Sam from taking most of my profit?
