Yes, but then you are assuming that his average profit per trade will be the same in the long run. In any case and in general, if the commissions/spread/slippage represent 5% of your gross profit, you need to make at least 5% just to break even, on each trade. And like I said before, the overwhelming majority of hedge funds cannot even make 2% a month on average.
on what capital ? 2% represents how much in $ for the average hedge fund? So that we know if it is worth dusting off a CV.
Hi SmallStops, If you deposit let's say a hundred grand in your trading account on January 1 and on January 31st you now have $105.000 you just made 5%. And again, for the last time, make just 2% a month consistently and Warren Buffet will be looking for you
I don't really think it's about % earned more then money made. Making 2% a month on $100K isn't that hard. That's only $2,000. The big traders/investors manage $10s of millions. So 2% would be a huge deal. But what do I know.
10 million : 2% ==> 200 000$ / month. Or 100 000pounds/month roughly. So it is about being able to trade 1 000pounds/move ( pip/tick...)
Really? Then call Soros or Buffet or Bill Gates, they will beg you to manage their billions right away! By the way, 2% a month equals more than 27% return on investment at the end of the year, compounded. In other words, 3 times the average yearly return of the S&P 500!! So you guys are either drunk (and I can understand that, it's the weekend after all...) or you are just fooling around
Now I am starting to understand why a retail trader who was doing 3 000 pounds a pip on the dax tried to keep quiet. Now we know what the numbers are, it makes sense.
Managing 2% monthly return on $100K vs $10M is a totally different ball game, both psychologically and in risk.
Take Barclay Hedge for example. Looking at their January monthly, top CTAs managing <$10M earned 8.93-38.76% while CTAs managing >$10M earned 6.74-14.33%.