That is shockingly dumb. The only thing sadder than a person so idiotic to actually believe that crap is how I managed to get myself into a conversation with such a fool. 20% a month for decades? How are you able to tie your own shoes in the morning with such a malfunctioning brain? 10,000$ @ 20% a month for 5 years = 100 million 10,000$ @ 20% a month for 10 years = 1,019,721,693,211 $ I know I'm new around here, but there doesn't seem to be very much "elite" here at Elitetrader...
Why did he not compound his money ? Or would stating the compounded amount produce a much less impressive number such as 0.5% a month, something that the OP can easily achieve as a market maker ? Obviously the OP needs to be a nano-scopic market maker with his $1000. I don't know for sure, but how much do exchanges and regulators charge for the market maker license ?
From all the good traders that i know with a medium to large capital (few hundred k to millions) , non of them are compounding their return. The reason is coumpouding is double edge, it can either compound your win or loss. Also, the pyso part is not easy when you compound your gain each month, it is easy to coumpound when you have small account as you don't really care ( 10 to 20k), but it is getting harder to pull the trigger when your capital is growing bigger. May be OP is different?
the responses make me LOL. All of this ego on this forum. The whole point of this is to say that mathematically it can be done and you should stay positive about it. I still thinking making 0.025 cents on many trades is possible with options. maybe I can't do it, but someone can. So is anyone who replied here making money? making amazing gains? or is everyone here just on here to bust balls and measure dicks? @VIXTrader, i appreciate your comments in my other thread. thanks.
Again though, just throwing the word math into a sentence doesn't mean there is any actual math being performed. All you're doing is dancing around within your own self proclaimed false premise. You say: Let's ASSUME that 1% can be made doing X strategy. Conclusion: That means 1% compounds to Y dollars after Z years. Well great, but just making a random and meaningless assumption that 1% can be made doesn't actually mean that the 1% can be made. It's just a random and meaningless assumption. Like I said, I'm not sure you know what the word "math" means. Both. 68% annualized over 4 years and 7.5 inches
so....when i say there's 1% to be made between the spread between the bid/asks of options, you're saying that's false? If there's a 1% difference in the spread, why can't you make it? I'm not here to prove myself to anyone. Just on here trying to learn to see how other people think and how they do in the markets. when you say annualized over four years, I'm assuming you're saying you've made a total of 68% over the course of 4 years. or are you saying you've made 68% a year for the last four years. Which would mean you've just about tripled your money.
During news or special events, the spread can be much wider. I once paid more than 10% spread at my bucketshop. That taught me to never mess with the market price. So you can make a lot more than 1%. If you compounded it, you will beat Warren Buffet easy. You don't need to. I think you are on the right track to go after the market maker side of the business. It's a license to print money.
There is literally a million ways a person could insult that comment, but let me try to be more mature about it and say.... because it doesn't work that way. I strongly suggest before you start trading, you figure out why it doesn't work that way. you know... um... Man, what to say to that? High road, high road, no insults, take the high road... Ok my polite answer is, the word annualized in the investment world means that's how much you've made on an annual basis over a certain time period. One month, one year, 50 years, it's a common practise to annualize those results so they can be scrutinized in a more uniform way. So yeah, 68% annualized over 4 years is a geometric compounding. It's about a 700% return over the 4 year period, 10,000$ becomes 80,000$, or simply put, 68% annualized.