DislikedOk so let me get this straight you know people that trade on 50k accounts and generate 20% a month, so that's 240% a year. Alright let's compound this out.
3 years 50k at 240% turns into 2 million
5 years it turns into 22 million
and 10 years it turns into 10 billion
So in 10 years you can generate 10 billion dollars from 50k. Now that's pretty impressive. Do you understand my point. It's doesn't work like that. You can't compare anyone to buffett or soros. Those guys are legends.
If anyone can seriously trade and generate profits, legends...Ignored
The same strategy you used to compound a 100K account to 1M could not be used to compound a 1m account to 1B. The numbers look nice in a spreadsheet and the logic seems simple enough, but at some point if you want to make the multi millions + you're going to have to learn a more advanced version of the game you already play. It wouldn't be knowing which prices to buy and sell at (you already do), but more about HOW to Buy and Sell @ those prices.
You can't compare small 100K or 5K accounts to hedge fund accounts. It's Apples and Pares. They play a completely different game to that of a regular trader and much of it revolves around acquiring the liquidity needed to fill such large positions. This is a cost they incur that small traders don't have to worry about. We have the luxury of being able to trade at any price we want, when we want, at how much we want.
A hedge fund can't just say "oh cool, Aussies about to tank lets risk 1% of our 10B fund on this trade and sell at the market". 1% of 10B is 100M, so what they now need is a willing buyer of 100M AUD... Are you game? Would you take the other side of that trade? Someone has to...
A 100K account holder could see the same trade and short it with no worries, hit the bid take a $3000 profit or a $1000 loss.
This is why Hedge funds settle for such seemingly meager % returns, 1) it's all they need to make a boat load of money and 2) It's all they really CAN make because at those massive fund sizes there simply isn't enough people willing to LOSE that much, in order for them to GAIN that much. The money has to come from somewhere/ someone.
If you really know how to trade Forex, 1000% on a small (<$5k) account over time (within a year) is nothing. But as your account grows that % shrinks which is what compound interest forecasts often fail to account for (as well as tax as someone mentioned earlier.
This is why debates between 5K account holders and 100K account holders about % gains is simply ridiculous.
Time hides Nothing