A Plan for New Share Investors/Traders

[Realist]

Basically it says the young leaders of today are earning wealth 10 times faster (due to the amount of information available).

Complete and utter bollocks.

For instance Rockefeller was far far richer than Bill Gates is now if you index inflation.

What examples do you have of young Australian's earning wealth far quicker today than 50 years ago?

The richest people are all old farts or inherited money from what I can see.

Lachlan Murdoch and James Packer for instance - show me modern day examples of young Aussies that surpassed by 10 times what Kerry Packer and Rupert Murdoch did years ago?

Times change people so unless you change with it, you will always believe that 5-10% p/a is a fantastic return and be like 99% of sheep.

I do not believe 10% is a fantastic return. It is a good return though, after tax, brokerage and fees.

I do believe 20% is a fantastic return

And I believe 30% year after year after all expenses is totally unachievable.

Warren Buffett has not even managed that himself, his average is 29.5%% from what I last saw.

This is from total investments I am talking about!! Any moron can do a small trade and make 50% overnight. I am talking about putting all of your available capital into investments and getting a 10% yearly return after all expenses are taken into account - especially tax and brokerage fees. Then doing the same the year after.

26% return after tax each year means you double your money after 3 years.

Good luck doing that with all of your capital!!!

Still dreams are free.

 

[Realist]

I didn't say I expect that, but I'm not happy with less

You wont be happy very often then I'm betting.

Also, that's pre-tax, but including brokerage.

Yeah and on small trades too I bet, not on your total capital. 10% on a trade before tax is a fair aim - I have no problem with that.

But..... that is not what we were talking about.

What do you expect as a yearly return after all expenses including tax on your total capital over 10 years?

BTW, I think Cynic is a more appropriate username for you.

Fair enough.

 

[professor_frink]

Realist, a good options trader can double their money annually. I bet they are happy more often than you think. Especially in a market like this.

 

[Realist]

swingstar mentioned in another thread that he trades options.

hence the higher goals.

Yep 10% on a trade over a month or even a day is highly achievable. Even after tax and brokerage.

And 10% is a good effort after investing for 1 year after tax and brokerage on your total capital though.

That is the difference between investing and trading. The amounts.

Traders risk small amounts on trades hoping for high gains, investors put huge amounts into investments expecting small gains.

This thread was about investing, not trading. And in which case mentioning 10% a month is ridiculous. No-one consistently makes 10% on their total captial each month, few make more than 10% a year!!!

 

[professor_frink]

This thread was about investing, not trading. And in which case mentioning 10% a month is ridiculous. No-one consistently makes 10% on their total captial each month, few make more than 10% a year!!!

look at the title of the thread- investors/traders

 

[Realist]

Realist, a good options trader can double their money annually. I bet they are happy more often than you think. Especially in a market like this.

Sure it is possible. Of course. Not consistently over the longterm though - impossible. If so please show me some evidence, a link??


To me it is no surprise that Warren Buffett is the second richest man in the world and not some day trader.

 

[swingstar]

Yeah and on small trades too I bet, not on your total capital. 10% on a trade before tax is a fair aim - I have no problem with that.

On my total trading account, I average more than 10%.

Example: April I hit 20%, May I hit 35%, this month I'm at break even still.

 

[Realist]

look at the title of the thread- investors/traders

Fair enough.

Prof Frink, what % return on your total capital after fess and tax would you be happy with after a year of trading?

I'm happy with 10%, I aim for higher of course. But 10% is not bad, I aim not to lose first of all. And I only buy ASX shares that pay dividends, and it includes dividends.

 

[Realist]

On my total trading account, I average more than 10%.

Example: April I hit 20%, May I hit 35%, this month I'm at break even still.

Well I better be nice to you, you'll be the richest man in the world in 10 years.

10% a month. Wow. You triple you money yearly!!

Jan 1st 2006 $100
Feb $110
March $121
April $133
May $146
June $161
July $177
August $194
September $214
October $235
November $259
December $285
December 31st 2006 $314


How much did you start with as your total capital?

$100 will be worth about $5,904,900 in 10 years time!!

So if you started with $10,000 you'll be richer than Warren Buffett in about 2017.

Can I borrow some money please?

 

[professor_frink]

I get the feeling that I'm about to get challenged to prove whatever figure I say here!!!

Given the current climate I expect 10% a month. So far this year I've done that in every month bar feb.

 

[swingstar]

Yes, I will be up there, if I hit 10% a month, every month, for 11 years.

But I'm sure I will retire when my capital is in the upper 7 figures, hopefully before 10 years time (I have investments elsewhere that do better than 10% a WEEK, but are short-lived). I'll probably diversify into property actually, as whatever takes less time but brings in the $$$ is my goal.

At the moment, I spend a lot of time on trading, no doubt about it.

And no I don't day trade.

 

[Realist]

I will retire when my capital is in the upper 7 figures, hopefully before 10 years time (I have investments elsewhere that do better than 10% a WEEK, but are short-lived).

Well to me you sound young and new to trading.

Be carefull!!

 

[swingstar]

My system is very mechanical. You learn a lot more when you quit your job and you have to rely on trading to get by.

Also, my capital could be lower 7 figures for all you know. It's not, but just making a point that you jump to conclusions very fast. Most of the population does that.

 

[professor_frink]

Well I better be nice to you, you'll be the richest man in the world in 10 years.

10% a month. Wow. You triple you money yearly!!

Jan 1st 2006 $100
Feb $110
March $121
April $133
May $146
June $161
July $177
August $194
September $214
October $235
November $259
December $285
December 31st 2006 $314


How much did you start with as your total capital?

$100 will be worth about $5,904,900 in 10 years time!!

So if you started with $10,000 you'll be richer than Warren Buffett in about 2017.

Can I borrow some money please?

Comparing investors and traders isn't really appropriate Realist.

The only thing that warren buffet has in common with swingstar and myself is that we all buy things with the aim of profiting off them. Different instruments, different timeframes. Like chalk and cheese.

 

[Realist]

My system is very mechanical. You learn a lot more when you quit your job and you have to rely on trading to get by.

If you wanna be rich - get a job or a carerr at least.

Also, my capital could be lower 7 figures for all you know.

There aint a young newbie trader in the world trading millions of their own money each month. (I hope)

It's not, but just making a point that you jump to conclusions very fast.

I do jump to correct conclusions fast don't I?

 

[swingstar]

If you wanna be rich - get a job or a carerr at least.

Tell me a job that pays a 22 year old $10,000 a month and I'm there!

 

[Realist]

Comparing investors and traders isn't really appropriate Realist.

They both want to make money, one overnight, the other one in a lifetime.

Is interesting to me the differences.

 

[Realist]

Tell me a job that pays a 22 year old $10,000 a month and I'm there!

Many, many jobs pay $10,000 a month plus super, expenses, overseas trips, health insurance, 4 weeks holiday etc.

Not many for 22 year olds I agree. 26 to 28 is probably the starting age for these jobs. If you don't get in on the ground level you wont get there.

Also I'm not sure I believe you will make $10,000 profit each and every month. How's June looking for you?

 

[professor_frink]

they both want to make money, one overnight, the other one in a lifetime.

Is interesting to me the differences.

It's pretty obvious from your statements here, and on other threads that you aren't a fan of trading. Do you mind if I ask why?

 

[dennisll]

Warren Buffett, in the 1993 Berkshire Hathaway Annual Report...

"Through my favourite comic strip, Li'l Abner, I got a chance during my youth to see the benefits of delayed taxes, though I missed the lesson at the time. Making his readers feel superior, Li'l Abner bungled happily, but moronically, through life in Dogpatch. At one point he became infatuated with a New York temptress, Appassionatta Van Climax, but despaired of marrying her because he had only a single silver dollar and she was interested solely in millionaires. Dejected, Abner took his problem to Old Man Mose, the font of all knowledge in Dogpatch. Said the sage: Double your money 20 times and Appassionatta will be yours (1, 2, 4, 8.....1,048,576)..."

No links. Easy enough to google yourself

Again, the timeframe of a year was chosen by me to make the example more simple. I have said before and I say it again, it does not imply that doubling your money in a year is the norm or even achievable.

Cheers,

Dennis