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The dreams are gone email. I just love it when we get several
different posts about what can and absolutely can't be done.
The facts I know are that there is a change in the way successful
traders manage their trading as their equity grows. They make really
big returns for a time and then the capital is large enough they don't
trade as large as they did. Or as heavily margined as they did.
You can't say a guy can't make 20% trading stocks full time. There
are mutual funds that have 10 year track records that are higher than
20% and they use no margin but rather a pretty high cash reserve.
Private traders make so much money it is hard to believe. I don't
mean the guys working for a bank. I mean the guys that work for my
buddies that have Billions. Those guys blow the numbers away all
these posts pitch out. It is fact. No I don't know anyone that made
100% every year trading stocks for decades but I know guys that did
that well for several years until the money got so huge they
emotionally couldn't or didn't need want to take that risk any longer.
They guys I'm talking about get fired if they are not as good as the
boss wants. Even if he is making 60% per year. If the other guys are
making 90% Mr. Sixty is gone and three new guys come in. Fact.
So bottom line is you can make as much as you want if you have the
nerve and the greed for a lot more money. When you can't trade out of
fear then you will slow down. If you reach your financial goal you
will slow down. Equity volatility means nothing to someone that is
absolutely positively going to make a ton of money this year. Been
there done that.
Jimmy
Friday, October 1, 2004, 1:57:14 PM, you wrote:
Sac> Abhijit wrote:
Sac> "What if you say my stock traders results were too rosy to
Sac> begin with? If the trader is only making 20% on the account? I
Sac> dunno about you - but someone making 20% in a year trading stocks
Sac> *fulltime* is certainly good, but surely no guru material."
Sac> Not to start a fight, but "20% trading stocks *fulltime*"
Sac> IMHO is GURU MATERIAL... If you are able to return 20% per year
Sac> for an extended period (5-10) years through various market cycles
Sac> (not just 1998-1999 bull market geniuses) you are the man.
Sac> People looking to return 40%+ per year on their
Sac> over-leveraged $25,000 account are in for a big dissapointment,
Sac> and anyone claiming to do this on a regular basis is smoking
Sac> crack. Any hedge funds returning, including this year, 20%+ every
Sac> year over the past 5 would be in the top 1% of the industry.
Sac> Increasing leverage increases volatility. It is
Sac> unavoidable. The best way to trade for a living is to be properly
Sac> capitalized. If you have to go get a job trading for an
Sac> investment bank, prop shop, hedge fund or even plain vanilla
Sac> mutual fund. Roger Sheppard's e-mail is the first response I have
Sac> seen to this discussion that made sense to me. In fact, I could
Sac> have written it--It is very similar to the situation I am in.
Sac> I have been involved in trading for almost 15 years. I have
Sac> been trading for a living for over ten years, and was a clerk for
Sac> the first five. Around 1999 I was a prop trader for Spear, Leeds
Sac> and Kellogg and posted a message on the O-list looking for
Sac> successful prop traders seeking positions trading firm capital. I
Sac> can't tell you how many people told me how stupid it was to do
Sac> trade for a 35% payout when they could trade their own capital
Sac> and keep 100%. Even when I pointed out that they had the
Sac> potential to trade an account much larger than 3X their PA it did
Sac> not register... Why risk your own capital if you can risk someone
Sac> elses for 1/3 the payout on 3X (or much more) the money (plus
Sac> have a salary, benefits, etc.?) I bet 99% of the people that
Sac> attacked me for my post have since blown out and are now mortgage
Sac> brokers...
Sac> Trying to trade a $25,000 account a make a living is a recipe for DISASTER.
Sac> Sorry if I started ranting a little. It is just frustrating
Sac> to see people led to believe they can make 100% per year on a
Sac> regular basis. It is not that easy...
Sac> Good luck trading,
Sac> Seth
--
Best regards,
Jimmy mailto:jhsnowden@xxxxxxxxxxxxx
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