The active thread "how much..." caught much attention, however, the poll is a bit "too absolute" for me... Therefore, if at all possible, please re-vote in this poll !! The percentage options in the poll should reflect your net average account's performance over the last, say, 3 months. Here I am talking about "average daytrader's accounts", maybe everything from 20k - 500k. Kind Regards, Sascha
The problem with % returns on equity is that for a professional daytrader, it's a meaningless number. You are trading the firm's money and sometimes don't even put up anything of your own. If you put up $5,000 and earn a 200% annual return, that sounds impressive, but you'll still be broke and out of business by the time you eat and pay rent. If you are this kind of trader, it's really only your net return, in dollars that matters. If you are a retail trader with fixed capital and limited margin, then that is different, but I just think it's an apples to oranges comparison. BTW, I'm pushing + 100% for the year, are you impressed?
I see now where the confusion lies and causes unneeded arguments and disagreements on this site. Prop traders tend to think in dollar amounts, monthly or yearly paychecks so it is natural for them to discuss matters in those terms. Independent traders tend to think in terms of return on equity. So 100k per year may not mean much to the independent trader, but it is a point of reference for the prop trader. Likewise, a trader who makes $100 dollars a day on a 5k account may not impress a prop trader, but it would be considered a successful foundation for an independent trader.
regarding prop traders or non-cleared accts, one still will consider in his mind the money he made or lost divided by his average exposure (USD amount)
On the last 3 months, I consistently pulled out a little 600⬠net each month from the (future) market with my undercapitalized 4K account. That makes a 15% return. Conclusion : be cautious with % return.
of course. but, IMO, % returns are still more expressive than a $1000 or a $15000 figure, without knowing if it was a 20k stock or a 200 lot ES trader.
Can someone tell me what the average (mean and/or median) wage is in the US? I don't want a subjective answer. Alternatively, where on the web would I find this info?
x-or, 4k is not neccessarily under capitalized. It depends on your allocation model. Many trade es with a 5k per contract allocation and hold it there even if account drops to the equivalent of 4k per contract. True, you have no where to go on the downside, but the 4k is again meaningless out of context. If what they say is true, 15% over 3 months puts you in the top 10% of all traders who ever traded in the history of the World. Next time you see Warren, give him the little nod and wink, he'll know you're a member of the club.
Heh, you ever check out the department of labor? I know of no entity that can ask you how much you make in so many ways (inandlong). They ask you how much you make by hour, by national region, by state, by job title, by sic code, with or without benefits, by seasonal factors, scrambled, fried, with green eggs and ham... gotta justify all our tax dollars they're collecting. Here's some links. I was having problems with the link directly so you may need to rightclick and save the file to the hard drive first. http://www.bls.gov/ncs/ocs/sp/ncar0002.pdf http://www.bls.gov/oes/2000/oessrci.htm http://www.bls.gov/