Comments on: Two questions for the readers http://thetradingdigest.com/blog/2007/07/10/two-questions-for-the-readers/ Wed, 03 Dec 2008 00:03:29 +0000 http://wordpress.org/?v=2.6.3 By: Not Hurting http://thetradingdigest.com/blog/2007/07/10/two-questions-for-the-readers/#comment-2035 Not Hurting Fri, 13 Jul 2007 05:07:53 +0000 http://thetradingdigest.com/blog/2007/07/10/two-questions-for-the-readers/#comment-2035 When I started full time trading last year, I really had no expectation other than thinking I could do better than a full-time broker. After all, they're putting in 10 minutes a week for you and as a full-time trader you are devoting 9+ hours a day to trading, learning, reading and devouring the markets. It quickly made me realize it's hard to even make 10% - especially if drawing income from your portfolio to eat. I think John had a post before that showed you'd have to do at least 2 ES points per week to compensate for every $50K in salary you're trying to make up. In other words, if you need a $50K salary and you expect 10% , you need a minimum portfolio size of $500K to generate that. But your portfolio isn't growing. So you need to generate 10+n% ( 10% for you and n% to grow your portfolio). And 50K doesn't go far in some parts of the country. So yes - these sound like unrealistic numbers, but it depends on your portfolio size. Someone with $2 Mill only needs to do 2.5% a year to make $50K. Possible? Absolutely. This year is a little different. I've found my stride and maybe with a little help from the bullishness in the air, I might be able to do about 20-25% above my income draws. I've had one day drawdowns of 12-13% and they don't scare me anymore. They now present buying opportunities. So the end result - I'm thinking... full time need to generate 20-30% part-time need to do 10-12% otherwise put it in a mutual fund giving 8% max drawdown -13-15% Thanks guys! Not Hurting any more When I started full time trading last year, I really had no expectation other than thinking I could do better than a full-time broker. After all, they’re putting in 10 minutes a week for you and as a full-time trader you are devoting 9+ hours a day to trading, learning, reading and devouring the markets.

It quickly made me realize it’s hard to even make 10% - especially if drawing income from your portfolio to eat.

I think John had a post before that showed you’d have to do at least 2 ES points per week to compensate for every $50K in salary you’re trying to make up.

In other words, if you need a $50K salary and you expect 10% , you need a minimum portfolio size of $500K to generate that. But your portfolio isn’t growing. So you need to generate 10+n% ( 10% for you and n% to grow your portfolio). And 50K doesn’t go far in some parts of the country.

So yes - these sound like unrealistic numbers, but it depends on your portfolio size. Someone with $2 Mill only needs to do 2.5% a year to make $50K. Possible? Absolutely.

This year is a little different. I’ve found my stride and maybe with a little help from the bullishness in the air, I might be able to do about 20-25% above my income draws.

I’ve had one day drawdowns of 12-13% and they don’t scare me anymore. They now present buying opportunities.

So the end result - I’m thinking…

full time need to generate 20-30%
part-time need to do 10-12% otherwise put it in a mutual fund giving 8%
max drawdown -13-15%

Thanks guys!

Not Hurting any more

]]> By: Dave http://thetradingdigest.com/blog/2007/07/10/two-questions-for-the-readers/#comment-2016 Dave Thu, 12 Jul 2007 11:41:29 +0000 http://thetradingdigest.com/blog/2007/07/10/two-questions-for-the-readers/#comment-2016 I will get this party started. The question I assume is to challenge the unrealistic expectations that many 'traders" have. Mmmmmm. Since I would probably skew the answers that come after me I am going hold off on posting my thought until we get a few responses. So c'mon get "the backtesting guru " some data.....sorry John :) I will get this party started. The question I assume is to challenge the unrealistic expectations that many ‘traders” have.
Mmmmmm. Since I would probably skew the answers that come after me I am going hold off on posting my thought until we get a few responses. So c’mon get “the backtesting guru ” some data…..sorry John :)

]]> By: Henrik Soke http://thetradingdigest.com/blog/2007/07/10/two-questions-for-the-readers/#comment-2014 Henrik Soke Thu, 12 Jul 2007 08:01:57 +0000 http://thetradingdigest.com/blog/2007/07/10/two-questions-for-the-readers/#comment-2014 1. About 5-10% 2. About 10%. 1. About 5-10%

2. About 10%.

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