Quotations are used to denote a segment of text extracted from another's work, in this case, the previous post. You are misunderstanding its usage here. There is no tarnishing.
There is little reason to hope anything otherwise. The thumbprint of a supposedly successful system that went awry is, to have a seemingly good track record for a long timer period, then to blow up in a few days to weeks A number of people follow systems on places like FX-AUTO, collective2, and other places. The equity curve often looks like a bird flying into a window. A sudden sharp plummet to the ground. That is the most likely outcome to someone thinking they can make a living off $30K - become $100K. It is almost a mathematical certainty, if you understand Risk of Ruin. It is a matter of WHEN, not IF
12tradr.......please post how your friend does, daily, weekly, etc., along with his comments and state of mind, and size of account.
That's absolutely correct! (I got to page 7, and didn't get a chance to read the other replies) Absolutely no way he's going to get 60-100m/year income from a baby sized 30m. Blows my mind that someone would even try with that expectation year, after year of 60-100m income with the 30m to start! This person, if could pull this off, would become "celebrity" status after two years of 300+ % returns. LOL! If your friend can consistently compound 2% per Month, for a steady two-three years, he will get a job getting paid BIG. That's if the amount of risk, and leverage used in getting that return isn't crazy. Maybe a Standard Deviation of around 16% or less.
Trading prop with a leverage firm and your own account and trading other people money through managed accounts or a fund is not even comparable. I know plenty of traders that start the year out with 50k to 100k in their account and pull in 500K-7500 on good year and 100k on slow year. Can they scale that up to $50M....no fucking way. two different business models.
a) He doesn't want a "job", he just wants to trade his own account. So 2% a month is not what he's aming for, he beat that 5 years in a row. Not saying he could beat that forever, but if he has an edge and good money management in place, I'm not sure why he can't continue to do that (provided he doesn't compound so that liquidity becomes a problem) b) Although i agree that it is extremely difficult, I'm pretty sure it's not IMPOSSIBLE to bring in 60-100K with a 30K account when you use that kind of leverage. It may be just a matter of time until he blows his account, but if he trades 10 contracts at a time (he's starting with 5, against my advice to start smaller), it's definitely possible (but unlikely). We're not talking about compounding here and have all the money in the world, we're talking about bringing in 60K on a 30K futures account
Hey Jimmy Can you point in the right direction where the Money Management was discussed. Does it some how improve on what was discussed in Austinp's Backyard? Have a good trading day. JIM