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Question about returns


hey guys i know this has been asked before by someone else in this forum but there wasn't really a definitive answer. so i will ask again:

what is a reasonable expected rate of return trading exclusively the emini? you can give it in percentages or in dollar figures or points. if you give it in dollars or points, i would ask that you put the minimum amount of money that you would've needed to make that profit.

it would also be nice if you could give the amount of experience you've had in this business.

thanks!
as far as i know, the "expected rate of return if you purchase the stock today" should be the same as what "you require a rate of return of 18% for that stock". but since the company is expected to give growth rate (assuming it the same as EPSGR), the stock price might be moving with the same momentum.
9 days later and 1 reply....wow ppl
It's a difficult question - I've tried to come up with an answer a couple of times but have been unable to do so. I'm sure that others probably feel the same way.
quote:
Originally posted by feng456


what is a reasonable expected rate of return trading exclusively the emini? you can give it in percentages or in dollar figures or points. if you give it in dollars or points, i would ask that you put the minimum amount of money that you would've needed to make that profit.
thanks!


Hi Feng,

My experience is 1 yr with eminis and most of that study.
I watched a video yesterday with this guy selling his trading course.
He felt 2 points a day was reasonable (he has 24 years experience and most of it as a professional trader). He asks new student what they think is reasonable and they say 10points and he has that is totally unreasonable.

I know another site where they hope to get 1.5 to 3points per day.

Personally I feel though your question is a valid one (if its used to tone down a newcomer to day trading) the other side is self fulfilling expectations and limiting expectations.

I feel the best answer to the question are more questions:
1. Do you have a good system that you have tested?
2. How much experience do you have?
3. Do you practice sound money management?
4. How much time a day are you planning to spend on it? {Is this a full time occupation for you?}
5. Do you invest in self-study and self improvement?
6. Do you keep a list of mistakes and take steps to reduce or eliminate them where possible?
7. Do you keep a list of successes and take steps to increase and maximize these where possible?
8. Can you control your emotions?
9. Can you visualize yourself successful?
10. Are you professional? (1.e. keep a notebook, keep records, have a procedure and follow it?)

If you can do all these things you can keep increasing your performance and return.

From
http://tacticalfuturestrading.blogspot.com/2009/08/illusion-of-control-overmanaging-trades.html

"One way to combat this tendency is to have explicit, written out instructions for what you need to do to execute each strategy. Review this list every morning before you get started. Do it slowly and focus on each step.

Here is a little exercise: Think about the tinkering you have struggled with, and visualize yourself at the end of the month reviewing your P&L, and noticing that you "tinkered away" more than half the potential profits, or worse. Doesn't feel good, does it? Just the thought of it makes me angry. Now visualize what you need to do and the times you have done a great job. Think of specific things you are trying to achieve. Now visualize yourself reviewing your P&L at the end of the month, and how good it will feel to see you have "played the game" up to your potential. This kind of thing has helped me and continues to help me. When I don't intentionally make that link between long term results and my actions, my results suffer. "


I thought this was a very good idea. If you can do this kind of analysis then you keep improving. On the other hand 90% of people who try day-trading blow out their account.

I hope it helps!
thanks. i ask this because as someone who is still fairly new, i always wonder if what im doing is 'right'.
Hi Feng,

You're welcome.

From Sniper Trader:
if you can break even after 6 months you'll probably survive
and go onto making good profits.

If you can make a point or 2 that is doing well.

Joyce asked a question in another thread
http://www.mypivots.com/forum/topic.asp?TOPIC_ID=4730
Jim replied there that the leverage of an ESmini is too high for most new traders.

Also as you know there is a tread for new traders
http://www.mypivots.com/forum/forum.asp?FORUM_ID=11

hope it helps!


How long have you been trading and are you doing it full time?


Realistic? A very good, accomplished trader might average about 1 point a day net trading the emini contract over a long period of time.

However, it is not going to be like a paycheck. You are going to have good weeks and days and bad weeks and days. One month you might "kill it" and make 60+ points the next you barely break even. That is the reality of professional trading.

averaging 5-10 points a day for a long period of time would be insane. Most all new traders believe this is possible, which is why I think so many are frustrated and feel like failures. They try to push so hard to make all those points they are literally making it impossible for themselves to profit at all.

If someone claims to have averaged 2 points a day over a long period I would ask them to prove it. If you average 2 points a day for just 2-4 months of the year it should MAKE YOUR YEAR if you do not mess up too badly in the other months.

One of the best things a trader can do if they really want to get profitable is get some realistic goals. That is why this is a good thread topic. New traders need to stop beating on themselves for not Hitting "pie in the sky" aspirations that not even the Michael Jordan's of trading can achieve. The game is just not that easy.
Great post Nattdog!

Thank-you for helping us newbies




quote:
Originally posted by Nattdog

Realistic? A very good, accomplished trader might average about 1 point a day net trading the emini contract over a long period of time.

... The game is just not that easy.

thank you again. very encouraging to know where to aim for. ive been trading real money since march. lost a lot of money but have improved
quote:
Originally posted by feng456

thank you again. very encouraging to know where to aim for. ive been trading real money since march. lost a lot of money but have improved



Keep with it Feng.

We all need encouragement - myself as well.
Remember if you have a losing streak to take a break
review what you are doing and are you breaking any of your rules.

You can switch to SSOs for a while and still be trying your system but with less leverage.