I think all of you are wrong. I saw an infomercial this morning and waxie had some guy on that made $40,000 in one day. His previous best day was $25,000. But then again he said he has only been trading for 18 months and his account is $200,000. That means he made 1/3 of his money on two days. I would love to hear him talk about his down days. But what would you expect from a program that costs $9.99 for a thirty day trial.
Unless, he's just trying to insult me. I think that he thinks, someone actually has the capability to make an electronic brain that is complex and as usefull as a real human brain. If that's the case then he needs to get out of la la land, or stop dropping acid, or stop watch star trek re runs. Not that I'm a computer expert, but I did take a few years of programming. They are still working on fuzzy logic for computers. which is going to be hard since even now all computers really do is add through binary code the graphics interface was made so people could commmunicate with that. (even if they subtract they do it in such a way that they are adding) As far as using a "traditional neural network," that's taken straigt from sci fi's "I robot," and "star trek," I'm trying to learn to trade, get out of fantasy land. Just because it says it on some website does not make it true.
Thanks domina, what I'm trying to say is that.... If I traded with a $40,000 account and made $300 a day.. I would trade with and up my size. Day 1 40,000 day 2 40,300 ect............. So, that the return %, (whatever that may be) would go back into may account and compound, instead of being cleaned out for bills or something. So, on the second day instead of make say 2% on 40,000, I'd make 2% on 40,300. And so on and so on. I do realize that it's quite usual to have many losing days and a percentage might not come in every day. I do agree with you on risk management and everything else you said though. Like most new traders I like to look ahead at the possibilities.
Then put the fantasy calculator away, the sooner you let go of the idea of daily or monthly compounding targets the better. Your year end results will average out in the end to compound at some arbitrary number, but it's meaningless as a goal to think in those terms.
Understood, and appreciated. Like so many of the books I've read have stated on the phycology aspect, "Develop real skill in trading and think only of makeing a good trade wether that be a profitable one or one stopped out properly, and profits will be a natural byproduct." (errr, something like that, but that's the general Idea) P.S. Though, you have to admit the joker with the electonic brain scam going, is way further out into fantasy land than trying to find a percentage return.
First of all, try to win some trades and the % will show for itself. Instead of imagining a %, focus on how you will acheieve that %. Its amazing how so many traders are in love with % returns.
If we could understand the human brain, we'd be so simple we couldn't understand it. I'd say his bullshit meter isn't just working, it's in it's own personal, private little fast market.
ric, if you can do annual return of ~50% and keep max drawdown under 30% you're doing well. Most hedge funds, CTA, etc rarely manage to keep DD better than 30% over any extended period of time, and most are pleased to do 15% to 25% annually. Remember, Warren Buffet's compound annual return is about 25% with a max DD of %45, and he's made more than any of us here