Reasonable yearly profit threshold and expectations

Quote from jack hershey:

My numbers are:

1. within three years of starting with 300 dollars my weekly commissions were more than my salary as an "engineer/writer" at IBM which had at that time 80% of the world market.

2. I stayed two more years. I did not experience stress while trading. I kept sweeping my account and I got married and got a lot of toys. I also went to Europe for summers. I moved to Grennwich, Conn a small wealthy community near NYC. I sailed competitively. Then I moved to Switzerland and came home to Bucks County,Pa.

With regard to the numbers in your OP, I have never axperienced those numbers even though I am speaking of the easy days of the 50's and 60's. In stock trading, I have had million dollar days. (I left on the table twice your highest number in Q2.)

If I did do work it was because I was asked and my trading was not a concern of places like EOP, UCSC, etc. I squeezed in doing what I wished. Usually I dated or married seven sisters college graduates. When women were admitted to Princeton I was chosen by a psych major from the first graduating class.
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Is it me, or has Mr. Jack Hershey had the life we would all love to have and experience. I mean, he seems to have experienced everything i for sure hope to experience one day from trading. It would be nice to buy all the toys i dream about and do as i please, including wiping my ass with a roll of 100 dollar bills. Okay, maybe that's going too far with the wiping the ass with money, but you get the point. Something to shoot for though.
 
Quote from total_keops:

Two questions:

1 - For all you hustling hard to become a profitable full time trader and make a living of trading, what are your realistic yearly profit expectations. Assuming you start each year with 30-100k and can use some leverage do you expect to make an average professional (IT, engineer type of job) salary (50-70k) or do you expect to make over 100k-300k or even millions per year?
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A realistic 10% return on $100,000 is $10,000.
 
I plunked down $25k and quit my job. I lost 50% in 3 months. I slowed down, lost the rest in the next full year. I quit. almost, I traded super cheap options... got back in with remaining retirement $. Lost it. so my expectations, whatever they were, were to double my money in a year, etc. My reality was pain. 5 1/2 years later, I'm just starting to do it right. Statistically it is a vast improvement, real money isn't coming in yet, but it's a big difference and I cringe thinking back, looking back, replaying early trading videos, reading my journals, looking at my screen captures of my market analysis & trades....yikes.... No one could have told me this, I had to learn the hard way. GL
 
daytrading without 100k's almost never works out. you spend way too much on commission and even making 50% a year thats only 50-100k. but swingtrading with a few 10ks can work out, next to a day job. much less capital required, much less stress, and still a day job.
 
I think having an income target is setting oneself up for failure as it produces pressure and expectation.

I thinking having a workable plan or system and taking or extracting from the market what it can give is the way to go. Get out of losses and let profits run.

Odd to read Hershey shaving advice. Hey Jack, clippers come with guards to trim flavor savors, no need for scissors!

Also JH, you still live in Bucks County? I thought it was Colorado? I used to live in New Hope. Tried to PM you but you appear to not allow it.
 
Quote from nursebee:

I think having an income target is setting oneself up for failure as it produces pressure and expectation.

I thinking having a workable plan or system and taking or extracting from the market what it can give is the way to go. Get out of losses and let profits run.

Odd to read Hershey shaving advice. Hey Jack, clippers come with guards to trim flavor savors, no need for scissors!

Also JH, you still live in Bucks County? I thought it was Colorado? I used to live in New Hope. Tried to PM you but you appear to not allow it.
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A target gives you an idea of the volatility in your book vs the underlying assets you trade. If the imputed volatility in your book is way off than the volatility of the underlying assets then odds of failure are very very high.

If you expect to make 100% trading SPX futures (10 vol) then you are expected to move 10x what the underlying is moving. Only three ways this can be done:
1. Leverage to magnify the SPX futures impact on your portfolio
2. Shorter timeframes: to make more trades to capture more and more of those 10 vol moves.
3. Improved efficiency: have more winners than losers.

When you combine these three factors you can determine if your trading plan is going to be successful based on what your annual target is. If your trading plan won't hit the target, either you have to adjust your annual target or revisit 1,2, or 3 above; though it's much tougher to manage those than to change your target pnl.

That's why annual targets are important. It sets the trading plan parameters.
 
Quote from newwurldmn:

A target gives you an idea of the volatility in your book vs the underlying assets you trade. If the imputed volatility in your book is way off than the volatility of the underlying assets then odds of failure are very very high.

If you expect to make 100% trading SPX futures (10 vol) then you are expected to move 10x what the underlying is moving. Only three ways this can be done:
1. Leverage to magnify the SPX futures impact on your portfolio
2. Shorter timeframes: to make more trades to capture more and more of those 10 vol moves.
3. Improved efficiency: have more winners than losers.

When you combine these three factors you can determine if your trading plan is going to be successful based on what your annual target is. If your trading plan won't hit the target, either you have to adjust your annual target or revisit 1,2, or 3 above; though it's much tougher to manage those than to change your target pnl.

That's why annual targets are important. It sets the trading plan parameters.
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What about improved profit factor? Shorter time frames increases turnover and efficiency never hurts, but all of that assumes a constant profit factor.
 
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