Marketing your trader track record in raising outside money

Discussion in 'Trading' started by garfangle, Aug 22, 2009.

  1. If one wanted to run other people's money would it be appropriate to point to your personal but verified returns as an indicator of your abilities and what investors could expect from their investment?

    For example, let us say you started with $200K and grew it to $1 million over the course of four years. Does that mean your track record is one where investors should expect to earn 50% annualized returns?

    Most traders would say no, because such results are hard to duplicate, but then what do traders who seek to raise funds use in order to lure investors?

    It seems that almost all traders who raise capital need to show dazzling outperformance, not just mediocre market equaling performance to woo investors.

    N.B., the above situation is just a hypothetical.
     
  2. Lets say you did that - what the heck do you care about investors?

    Just go on. Make a sub-average 300.000 USD per year, save half of it and have a good life without the hassles ;)
     
  3. I remember one of my neighbors asking me for money for his money management business. It was a couple years ago. He said he could make 70 % / year using a mean reversion system. About a year later I recall asking how he is doing and he says he gave up, he is not trading at all, he works a job somewhere.

    I suspect we are all walking advertisements of our ability.

    If my neighbor was still trading, still supporting himself by trading and has no other source of income, if he survived the bear market in stocks with minor damage and currently showing capital growth then he might have client money to manage. But if he can not manage his own money, how can he manage mine?