Regarding "Few get a consistent 20%/year."

J

jk90029

Regarding "Few get a consistent 20%/year." as below.

I am sure that there will NO ONE at all in the world like that. Because over the last 400 years of capitalism, if there is any ONE person, then he should have all the asset in the world.
That means Buffet and Gates should be broken now. Therefore I am sure there WAS NONE with annual compounding 20%.

Just simply calculate 1.2^400.


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crgarcia

Preferably 500k.

Be aware that 10% of 300k is a measly 30k/year, almost a cab driver salary.

Most active traders lose.
Few get a consistent 20%/year.
 
However, I guess that there is someone who achieved annual compounding 10%.

Recall that 1.1^50 = 117.3909 and 1.1^400 = 3.606401e+16
 
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Well, you can compound up to a certain level. Then you got 10 billion on your trading account I guess it becomes hard to grow it further with short term trading. But at that level I do not think your care anymore.

As wins and losses are not evenly distributed all traders will experience prolonged draw down periods, months is the case of day traders and year in case of swing and position traders. You will over perform some months/years and under perform some. You are still consistent in your results even with losing or break even month/year.
 
bln said:
You will over perform some months/years and under perform some. You are still consistent in your results even with losing or break even month/year.
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I agree so we may need 6 month or 1 year or 3 year of ourperformance, instead of monthly performance.

For example, we need to show 30% (1.1^3 -1 =33.1% to be exact) for every 3 years, for 10% annual compounding.
Moving average smoothens rough surfaces.

If someone can say that "I outperformed the market for 40 years of trading, with 33.1% during all possible any 3 years of term.", then he is really 10% annual compounding.
 
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bln said:
Well, you can compound up to a certain level. Then you got 10 billion on your trading account I guess it becomes hard to grow it further with short term trading. But at that level I do not think your care anymore.
More...


Most does not reach billion in the zero-sum stock market, therefore we do not need to worry about the big money with less than annual 10% outperformance.
 
jk90029 said:
Most does not reach billion in the zero-sum stock market, therefore we do not need to worry about the big money with less than annual 10% outperformance.
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I suggest you read the following thread in its entirety.
: http://www.elitetrader.com/et/index...-all-stock-trades.290746/page-10#post-4109588
there is an individual by the name of volpunter who claims that he he has hedge fund trading friends in hong kong who take out of the market one percent per day and .005 after FTT.
enjoy.
 
bln said:
Well, you can compound up to a certain level. Then you got 10 billion on your trading account I guess it becomes hard to grow it further with short term trading. But at that level I do not think your care anymore.
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(1) It's more difficult to compound large money vs. small money.

(2) It's human nature to get more conservative once your assets become "significant enough to impact your life". IOW.... "you only have to get rich once."
 
jk90029 said:
Regarding "Few get a consistent 20%/year." as below.

I am sure that there will NO ONE at all in the world like that. Because over the last 400 years of capitalism, if there is any ONE person, then he should have all the asset in the world.
That means Buffet and Gates should be broken now. Therefore I am sure there WAS NONE with annual compounding 20%.

Just simply calculate 1.2^400.


************************************
crgarcia

Preferably 500k.

Be aware that 10% of 300k is a measly 30k/year, almost a cab driver salary.

Most active traders lose.
Few get a consistent 20%/year.
More...
Completely WRONG.

I make more than 20 % consistently on a capital of 50K.
I never trade more than 50K and spent my profit.
So your logic is not correct.
On top of that it is after some time IMPOSSIBLE to even invest all the money you made. You cannot buy for 100 billion $.

Nobody lives long enough to trade more than 50 years so taking 400 years is cheating.
If you start with 25K you can make compounded in 50 years 228million$ at 20% yearly return.
So your statement has plenty of errors and manipulative suggestions.
 
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i am nobody said:
Completely WRONG.

I make more than 20 % consistently on a
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Years ago when I was a struggling money manager "trying to make a track record and attract clients"... I did some research on money manager returns (independently audited, of course).... THOUSANDS reporting. I'd considered myself at least somewhat successful and wanted to know where I stood vs. the pros. You know, if I was going to charge customers a fee to trust me to manage their money.

Research results...

< 0.1 % averaged 30%, compounded for prior 10-years... from all disciplines... mutual funds, stocks, bonds, options, futures, etc.

< 10, averaged 40%. Out of THOUSANDS of money managers tracked, fewer than can be counted on one's fingers.

So... achieving 20% compounded annual growth is indeed "tall cotton".

Those crowing about "hundreds/thousands" of percent are just talking through their hat.
 
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