Return on Investment

Discussion in 'Trading' started by TDMA, Jun 6, 2018.

  1. TDMA

    TDMA

    If you have an amount, any amount, $1,000, $1,000,000, to invest in stocks, bonds, futures, forex, crypto, via managed, index etf, daytrading, what return do you expect per year on the capital?
     
  2. cvds16

    cvds16

    This is nonsense question. It all depends on the trading skill of the person in question. You could get ultrahigh returns or just bleed all year long. There is no such thing as an 'average trader'.
     
  3. I`d invest $1K in chicks and expect a lot of fun!
     
  4. TDMA

    TDMA

    Not exactly what was being asked, instead of trading what about investing.
     
  5. cvds16

    cvds16

    nothing changes in the answer
     
  6. Long term investing: 10% corresponding to the return including net dividends of the MSCI World index.

    Short term trading: a percentage figure doesn't make sense, because you typically cannot scale above a certain amount of capital due to market impact. Instead measure performance in absolute terms.
     
  7. fan27

    fan27

    Depends on the expected volatility of the returns.
     
  8. deaddog

    deaddog

    If you can outperform the index, you are doing well.

    One reason new traders fail is unrealistic expectations.
     
  9. Lee-

    Lee-

    I'm between $1k and $1M. ;)

    I expect the following annual ROI 30%, drawdown < 10%, sharpe 3, sortino 4.5. Will I meet that? IDK! I'm on track, but things can change very fast.

    If I couldn't beat the S&P500 / other passive investments, then all the time and risk put in to this wouldn't be worth it (except from a hobby point of view because I genuinely enjoy this stuff).
     
  10. Millionaire

    Millionaire

    Passive investing, 10% a year, with 20%+ drawdowns (once every 5 to 10 years or so).

    Active trading with 1 million USD and good risk mangement, 20%+ a year, with max 10% drawdowns.

    Not sure if you can get that good a MAR ratio (20%+:10%) with $100 million, or $1 billion. As lots of hedge funds have bigger drawdowns than their CAGRs.
    Although Rentec seem to do fine every year with a fixed $10 billion in their Medallion fund.
     
    Last edited: Jun 6, 2018
    #10     Jun 6, 2018
    comagnum likes this.