Realistic Rate of Return?

[skyQuake]

LOL McLovin.... Exactly!

In the end everyone becomes a liquidity rebate trader!

 

[tech/a]

In the end everyone becomes a liquidity rebate trader!

Most of these 50% + returns ar quoted against capital at risk.
Not total capital
You may have 1 mill but at any Time risk 50k and return 50k
All I know are gross not nett as already pointed out.

 

[beachlife]

Most of these 50% + returns ar quoted against capital at risk.
Not total capital
You may have 1 mill but at any Time risk 50k and return 50k
All I know are gross not nett as already pointed out.

Exactly. I'm not interested in the type of calculations that the gurus do like return on margin to make their testimonials look better, eg Hi Guru, thanks for making me a supertrader, I just made 300% on my first trade..blah blah

Back to Daryl, his results are quoted on total starting capital, $100k capital, $90k profit.

I am only interesed in return on total capital.

 

[skc]

No it's not, I asked others if they would share their results, not speculate on my abilities, so far no one willing to share.

You are saying you want to use it to help set your target.

Let's say 20 people responded and the average over the last 5 years were 7.8%, 33%, 1.2%, 19% and 55%.

How do you plan to make use of this information to help set your target?

 

[burglar]

You are saying you want to use it to help set your target.

Let's say 20 people responded and the average over the last 5 years were 7.8%, 33%, 1.2%, 19% and 55%.

How do you plan to make use of this information to help set your target?

I would average the averages! :

 

[beachlife]

You are saying you want to use it to help set your target.

Let's say 20 people responded and the average over the last 5 years were 7.8%, 33%, 1.2%, 19% and 55%.

How do you plan to make use of this information to help set your target?

That's like asking an olympic swimmer who's time they're trying to beat.

I would aim to match the best, which so far seems to be Daryl Guppys 90%.

 

[CanOz]

Hi Guys
I wonder if any active derivatives traders are willing to share their average rate of return to give me something to aim for. I know those with an investment mindset are happy to just out perform the index. I am more interested in actively trading for cash flow as opposed to investing for long term growth.

For me out performing the index is not enough to live on. I see examples of traders that have turned $10k into $110k in 12 months. Daryl Guppy's newletter sample portfolio averages around 90%pa.

I currently trade CFD's long and short on asx top 200, commodities, spi, aud/usd on a daily time frame, not intra day. If all of my stops were hit today my return on capital would be 18% since Jan. If I took my open profits today it would be 40%. Trade durations are 10 to 20 days, win loss ratio is 58% wins. But it's early days yet.

What are those that trade for a living consistently making? I need a realistic target.

Thanks.

0% or negative would be my bet for 99% of all home based intra-day directional derivative traders.

 

[Trembling Hand]

I would aim to match the best, which so far seems to be Daryl Guppys 90%.

It would be far easier to see where you are going with 5 months of trading stats and an equity curve rather than taking a a system that is vastly different than yours. Are you using leverage? It seems that Guppys isn't and has a very high win rate and not that active.

I think you said you are/were an engineer. I'm surprised you cannot see the huge fault you a designing into your system.

 

[beachlife]

I currently trade CFD's long and short on asx top 200, commodities, spi, aud/usd on a daily time frame, not intra day. If all of my stops were hit today my return on capital would be 18% since Jan. If I took my open profits today it would be 40%. Trade durations are 10 to 20 days, win loss ratio is 58% wins. But it's early days yet.

To answer the last 2 posts it probably best to quote the original post above. But as of Fri, if I include my open posiitons at Fridays close my return on capital over the last 5 months is 43%. If they all go bad on Monday it will be 18%. Not annualised, not on margin, no maths tricks, just straight % return on starting capital.

Yes I am an engineer, pretty good at maths too. No I cant see a fault with aiming for a performance target and then monitoring it. My system has risk management, position sizing, an entry trigger, a trailing stop, trades long and short over a variety of instruments, and I monitor its performance in percentage terms of risk vs reward and return on capital. Leverage is irrelevant, it merely allows me to position size in expensive shares without needing to worrry about having enough cash. It is not used as a performance measure and is not used for position sizing. If I want to risk $1000 on a cba trade I dont care what the margin or leverage is, as long as I have enough in my account to get the trade on. My capital is increasing, I have more wins than losses, and my wins are consistantly bigger than my losses. My system works, I am just trying get a feel for if it can be improved.


(I used to take profits at 2x risk, which is why so many are capped at 2, now I let them run a bit longer).


What huge fault do you see?

 

[tech/a]

I can see a number of areas
You ave identified 1 ---- a serious problem.
You have seen seen 1 as irrelevant --- although you are using leverage correctly in a portfolio situation.
And I see 3 areas you could improve on.
Frequency
Not moving initial stop
Pyramiding

Just off the top of my head.

 

[Trembling Hand]

My system works, I am just trying get a feel for if it can be improved.

AND that can be done with the numbers of YOUR system not someone else's. But really I'll leave you to it.

 

[Gringotts Bank]

That's like asking an olympic swimmer who's time they're trying to beat.

I would aim to match the best, which so far seems to be Daryl Guppys 90%.

I know a systems futures trader (fully automated) who has made over 100%pa for 5 years running, with miniscule drawdowns.

Also, have a look at the "Market Wizards" series of books. They highlight stats from America's best traders and fund managers over the long term. Great reading.

http://www.amazon.com/Market-Wizard...qid=1369452989&sr=1-1&keywords=market+wizards

 

[peter2]

Your current trading system can only get what it is designed to get. If you have done any backtesting then you would know what those values are. If you have been fully invested 100% of the time then you should be near your system limits. It seems that you may not know what your system is capable of achieving. You could review your performance to identify if there are any aspects that you can improve to boost the results.

You could consider how your results compare to the MAE and MFE of the moves (swings) you traded. You may like to calculate an efficiency factor for your trading.

My general observation is that most traders do not get anywhere near what their systems are capable of. The human is the weakest point in most trading systems.

 

[beachlife]

Your current trading system can only get what it is designed to get. If you have done any backtesting then you would know what those values are. If you have been fully invested 100% of the time then you should be near your system limits.

I am never more than 10% of total capital at risk and my back testing suggests my system should produce 100%pa, more if I compound the profits. My results since Jan suggest I am on track, but am I sure there are many out there doing much better. How much better is all I am trying to find out.

 

[Julia]

I am never more than 10% of total capital at risk and my back testing suggests my system should produce 100%pa, more if I compound the profits. My results since Jan suggest I am on track, but am I sure there are many out there doing much better. How much better is all I am trying to find out.

Why does it matter what anyone else is doing? Don't you rather work out what you need to make in order to fund your lifestyle/retirement plans/whatever and then make your own plan to achieve that?

If you have a substantial amount of capital available, then obviously you need to be less demanding on the % return and thus have more choices about what you do.

 

[Gringotts Bank]

I am never more than 10% of total capital at risk and my back testing suggests my system should produce 100%pa, more if I compound the profits. My results since Jan suggest I am on track, but am I sure there are many out there doing much better. How much better is all I am trying to find out.

Something is not adding up here and I am very suspicious.

On another thread you said your system consists of "just a moving average and a trailing stop. Once I reach a set profit I stop".

And yet here you say that the backtests suggest 100%pa return. I've never ever heard of such a thing. It sounds way off. I have run hundreds of thousands of backtests in my time. It's not even remotely possible. 100% might be possible for a very proficient programmer, but not with moving averages and trailing stops. Any system developer will back me up on this.

 

[Gringotts Bank]

Well....

I guess that puts a close to this thread. It was all made up.

 

[beachlife]

Something is not adding up here and I am very suspicious.

On another thread you said your system consists of "just a moving average and a trailing stop. Once I reach a set profit I stop"..

I never said they were the same system. What I am testing for intra day has nothing to do with my end of day system referred to here.

 

[beachlife]

Well....

It was all made up.

LOL. This from someone who says he trades by pretending he is George Soros. You are telling someone over there that is trying to learn and share his experiences to pretend he is a wall street legend. What rate if return does that generate for you? Did you short the aud/usd the other week like George did? I did because my system told me to, not because of any self affirmation nonsense.

 

[Gringotts Bank]

LOL. This from someone who says he trades by pretending he is George Soros. You are telling someone over there that is trying to learn and share his experiences to pretend he is a wall street legend. What rate if return does that generate for you? Did you short the aud/usd the other week like George did? I did because my system told me to, not because of any self affirmation nonsense.

It's not nonsense. Adding new and positive mental filters has had more impact on my bottom line than anything I've ever done in trading. It has allowed me to spot patterns in charts that I would never have seen before - high probability entries mainly. Some of these I have had coded for me, because they are quite complex. Amibroker finds the patterns, and on top of that I apply a discretionary filter to try to fine tune it. A person with a successful mindset will see a chart totally differently to someone with a loser mindset. The Method Acting approach is something I thought of. Hypnosis is a more reliable and robust approach to altering one's mindset.