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Earning 10-20% per month on 10k capital: Realistic?

  • #1
  • First Post: Mar 16, 2014 4:10pm Mar 16, 2014 4:10pm
Hello Everybody,

I have been trading for a quite some time now and had both Good and Bad luck but mostly Good luck considering that I have earned profit every month on my capital since the start.

I am usually a day trader and most of my trades are about 6 to 12 hours , but sometimes , they go longer if the situation demands it.

Now I am thinking of going all in with a capital of about 10k USD.

My plan is earn about 10% to 20% per month on that capital.

Now i have had pretty good trading strategy and I have earned about 40% to 70%+ return every month on my initial small capital .

I think those number seems exaggerated and show that I have had a very good luck or something but trust me they are what I was able to achieve.

Now my question to y'all is that , Is it possible to making atleast 10 to 20% on a capital per month while remaining realistic.

By realistic I mean , from an experienced trader's point of view, is it okay If I aim at only 10% to 20% return on my capital every month.

Or is it Aiming too high?? should i revise it down to a lower number or should I aim even higher?

I would like all of your feedback on my goals.

TL DR; Is it possible to make 10% to 20% profit on a capital of 10k USD while being safe and realistic?

Thanks
  • #2
  • Mar 16, 2014 6:01pm Mar 16, 2014 6:01pm
Quoting Sh0ukaT
Hello Everybody, I have been trading for a quite some time now and had both Good and Bad luck but mostly Good luck considering that I have earned profit every month on my capital since the start. I am usually a day trader and most of my trades are about 6 to 12 hours , but sometimes , they go longer if the situation demands it. Now I am thinking of going all in with a capital of about 10k USD. My plan is earn about 10% to 20% per month on that capital. Now i have had pretty good trading strategy and I have earned about 40% to 70%+ return every month...
It seems you are in my shoes.
Last year I did me too the same. I was very profitable with small account.
Borrowed some money and I had 10k AND I have changed my brooker ( where the maxed leverage was higher)

When I saw in 11 seconds I make 1.1k, than I was in ecstasy. By mistake I din't used 1 lot trade size, but 10 lot. If 10 lot moves 1 pip that is 100$. So if you earn 11 pip that is about 1k...

I don't know where it was my head to start again trade with 10 lot... I lost next trade. I got fear and lost 3-4 more trades. I won a few trades and adjusted the leverage to normal limits, but was to late, already lost to much.

My advice is:
If you played with 1k accouts ( or 2k ) just double the account size, let be 2/4k. See how is working for you the bigger numbers 1-2 week. - at least 5 trades.
If you feel good, and you had a looser trade and still want to raise the capital, than go and double the size again and trade 5x min , until you have the 10k or whatever is your limit.
I want to buy PATIENCE
  • #3
  • Mar 17, 2014 3:26am Mar 17, 2014 3:26am
Quoting Sh0ukaT
Hello Everybody, I have been trading for a quite some time now and had both Good and Bad luck but mostly Good luck considering that I have earned profit every month on my capital since the start. I am usually a day trader and most of my trades are about 6 to 12 hours , but sometimes , they go longer if the situation demands it. Now I am thinking of going all in with a capital of about 10k USD. My plan is earn about 10% to 20% per month on that capital. Now i have had pretty good trading strategy and I have earned about 40% to 70%+ return every month...

In a way you are asking other people what is their reality...successful people don't do that...
  • #4
  • Mar 17, 2014 6:37am Mar 17, 2014 6:37am
Quoting Sh0ukaT
Is it possible to make 10% to 20% profit on a capital of 10k USD while being safe and realistic? Thanks
What do you mean safe? How much are you willing to lose per trade?

I think cut the risk low... 1% to 2% per trade... And then see how much you can make. Don't focus on how much you want to make... focus on how much you are willing to risk/lose.

Professional traders make around 30-50% a year, with very small risk per trade. So you will probably have to risk a lot more to achieve 120%-240% a year.

I achieved 800% with demo account in half a year risking 5%-10% per trade, so it is possible, how ever it will be very emotional when seeing a drawdown of 30-50%.

In the end it all depends on your win ratio, how good a trader are you... if you are around 50-60% dont even think risking too much. Its a different story if you win 70-80% of the trades.
  • #5
  • Mar 17, 2014 7:06am Mar 17, 2014 7:06am
Quoting Sh0ukaT
Now i have had pretty good trading strategy and I have earned about 40% to 70%+ return every month on my initial small capital .
If you have tested that at 600-1000 trades than is fine, just need to add this:

Quoting teofil00
Don't focus on how much you want to make... focus on how much you are willing to risk/lose.

If you did those with a small number of trades (according to your trade plan ) than at the big numbers will show you are wrong.

I had a series on 17-23 consecutive wins. With that every trade plan works, until you get 3-4 consecutive looses. And those will happen: after 200 trade or after 500 trade, but it will happen. Check your trades how it will be with those consecutive losses. Specially with 7 consecutive.

If you focus on how much need to earn / month it will distract you from your trade plan and you will search entry points, where they aren't , just because " I need to make x% at this month" and that will lead to fail with very high probability.

Just double your account size and don't quit yet from daily job 1 year, don't borrow money.
I want to buy PATIENCE
  • #6
  • Mar 17, 2014 7:14am Mar 17, 2014 7:14am
Quoting teofil00
{quote} What do you mean safe? How much are you willing to lose per trade? I think cut the risk low... 1% to 2% per trade... And then see how much you can make. Don't focus on how much you want to make... focus on how much you are willing to risk/lose. Professional traders make around 30-50% a year, with very small risk per trade. So you will probably have to risk a lot more to achieve 120%-240% a year. I achieved 800% with demo account in half a year risking 5%-10% per trade, so it is possible, how ever it will be very emotional when seeing a drawdown...
Hi,
Can I ask you what strategy do you have?
  • #7
  • Mar 17, 2014 8:22am Mar 17, 2014 8:22am
Quoting Trader05
{quote} Hi, Can I ask you what strategy do you have?
Of course you can, you just did.

 

  1. It is based on technical analysis with little fundamental analysis... when there is no fundamental analysis then i just avoid the news.

  1. Technicals: Heavy support and resistance levels (these are on the 4H or bigger time frame charts)... Risk reward always 1:1 or more, but never 2:1. So i always win as much as i risk, or win more than i risk. This way even if i lose more than i win i still win or break even.

  1. Looking at 4H, 1D and weekly charts... sometimes for entry 1H.

  1. Being VERY PICKY, meaning if not too sure then i dont take the trade.

  1. Always having a TP and SL, (on my demo account i never had SL or TP) without it you are over exposed... even if i dont wait for TP or SL to get hit, i always have them... just in case.


I found paper trading of past charts helped a lot identifying resistance and support.

Of course its more complicated than these, but these are the fundamentals... I always tell people to do a lot of paper trading on a simulator.... what ever the strategy, even if you dont have a strategy, just do paper trading and you will see patterns on the charts.

Try this simulator, paper trading can be very addictive:

http://www.forexfactory.com/showthread.php?t=70742

  • #8
  • Mar 17, 2014 8:48am Mar 17, 2014 8:48am
you should try the search function there is a lot of threads already done like this. If you can't use the search function to research the 70 threads that already discuss this ... you wont get very far. don't expect answers to fall in your lap.
  • #9
  • Mar 17, 2014 9:26am Mar 17, 2014 9:26am
Quoting matheszabi
{quote} If you have tested that at 600-1000 trades than is fine, ... Just double your account size and don't quit yet from daily job 1 year, don't borrow money.
Thanks Alot , for now I have had only ~200 trades , So I guess i need to work more on my strategy and give it another 6 months or so...

Okay I will just double my account size and my trade lots and then see how things go...
  • #10
  • Mar 17, 2014 9:29am Mar 17, 2014 9:29am
Quoting teofil00
{quote} What do you mean safe? How much are you willing to lose per trade? I think cut the risk low... 1% to 2% per trade... And then see how much you can make. Don't focus on how much you want to make... focus on how much you are willing to risk/lose. Professional traders make around 30-50% a year, with very small risk per trade. So you will probably have to risk a lot more to achieve 120%-240% a year. I achieved 800% with demo account in half a year risking 5%-10% per trade, so it is possible, how ever it will be very emotional when seeing a drawdown...
My Win ratio is around 75% , but thanks again for your advice ,

In my current strategy I think I am risking too much , thats why it explains my high earning ... I have risked up to 20% of my capital... I think i need to tone that down and reduce my lot sizes and remember that Slow and Steady Wins the race...
  • #11
  • Mar 17, 2014 10:19am Mar 17, 2014 10:19am
No it's not possible. Think about it: 10 to 20% per month, that would be over 100% per year. No one does that Profit, nobody ever has, nobody ever will.

The best of the best make 20-30% per year, which is very high. Why should you be better than the best? It's pretty unlikely.
Forex is a losers game.
  • #12
  • Mar 17, 2014 1:25pm Mar 17, 2014 1:25pm
Quoting trader121
No it's not possible. Think about it: 10 to 20% per month, that would be over 100% per year. No one does that Profit, nobody ever has, nobody ever will. The best of the best make 20-30% per year, which is very high. Why should you be better than the best? It's pretty unlikely.
lol

http://www.forexfactory.com/realreason#87
I want to buy PATIENCE
  • #13
  • Mar 17, 2014 4:20pm Mar 17, 2014 4:20pm
The question is: Are you ready to lose 10K ?

All said.
The Black Swan: The Impact of the Highly Improbable
  • #14
  • Mar 17, 2014 4:41pm Mar 17, 2014 4:41pm
Quoting matheszabi
{quote} lol http://www.forexfactory.com/realreason#87
Now thats Enough Said... =)
  • #15
  • Mar 17, 2014 10:10pm Mar 17, 2014 10:10pm
[quote=trader121;7345401]No it's not possible. Think about it: 10 to 20% per month, that would be over 100% per year. No one does that Profit, nobody ever has, nobody ever will. The best of the best make 20-30% per year, which is very high. Why should you be better than the best? It's pretty unlikely.[/quote

Best of the best risk only 0.25 % to 0.5% per trade, they are risk adverse trading with other peoples money. Retail traders trading 1% per trade with a good system are risking a 10% DD. A 2% per trade are risking a 20% DD. So their returns can be 4 times that of the best of the best cause they are taking more risk. If you are looking for a hedge fund to invest your money then yes, 20-30% is very high. If you have a losing system then no matter what you risk you are going to go bust. If you are risking 5% per trade be ready to handle 50% draw downs. Higher than 5% be ready to blow up you account when that 7 to 10 trade losing streak hits. Does greed come before fear?
  • #16
  • Mar 18, 2014 1:04am Mar 18, 2014 1:04am
Scale out and maintain the lot size ratio IE: If you traded one mini with a 1K account, then that should translate to 1lot for a 10K account.
Maintain the risk per trade - 1-2% and your max exposure @ 5%.
Do your thing and manage your risk sir
  • #17
  • Mar 18, 2014 5:50am Mar 18, 2014 5:50am
Quoting matheszabi
{quote} It seems you are in my shoes. Last year I did me too the same. I was very profitable with small account. Borrowed some money and I had 10k AND I have changed my brooker ( where the maxed leverage was higher) When I saw in 11 seconds I make 1.1k, than I was in ecstasy. By mistake I din't used 1 lot trade size, but 10 lot. If 10 lot moves 1 pip that is 100$. So if you earn 11 pip that is about 1k... I don't know where it was my head to start again trade with 10 lot... I lost next trade. I got fear and lost 3-4 more trades. I won a few trades...
this is the best idea

if you are trading with 200$ account just try with 500$ for week when you feel that you have the control double it to 1K and take your time to undersatand the changes (lot size) wining and losing things
untill you reach 10K
  • #18
  • Apr 13, 2014 3:55pm Apr 13, 2014 3:55pm
Increasing trading deposit little by little is good idea psychologically. However based on my experience, still don't expect 10% per month (even if it's mathematically possible and your excel sheet shows you any rocket numbers..). If you would choose a way of stable calm trading, expect 5 - 25% p.a. It's still quite great growth, isn't it? If you know that you are able to make it steadily...
  • #19
  • Apr 14, 2014 5:32am Apr 14, 2014 5:32am
Personally, my goal is 5% per month on my account. I think if you make a "profit", ie, something larger than break-even, you are a successful trader. If you can realize profits that are several percentage points on your account each month, the cumulative effect is powerful. For example, 5% on your account each month is not 60% per year. If you compound your earnings, you will make 79% annually on a 5% monthly increase, assuming you make 5% each month. The formula used to calculate this compounded earnings is [annual_rate = ((1+ return.period)^no of periods)-1], where return.period is equal to the return you get in each period (ie. 10% per month). So if you use that for 10% monthly, you will see that you earn 213.8% on your account over a 12 month period. So, if my spreadsheet calculations are correct then a $10,000 balance in Jan would give you a $28,531 balance in Dec. That's an excellent return, and if you can duplicate that process that gives you the 10% monthly return, then you are set for life, because in just a few short years you will be exceedingly wealthy.

~happy trading
  • #20
  • Apr 14, 2014 10:25am Apr 14, 2014 10:25am
I would like to caveat what i previously wrote. First, i will say that although I am new to this site, I am not new to trading. I have been trading forex and options for about 3 years now. This certainly doesn't make me an expert on either of those subjects, but something that I have notice from rookie traders is the exact title of this thread... Earn 10-20% per month and get RICH!!!! I know, I have been there too. But all too often new traders focus on the END rather than on the long, hard journey it will take to get to the end. So I understand your desire to make 10% per month, I would like that as well. But rather than focusing on the 10%, focus instead on developing your trading plan and strategy that will get you there.

Ideas:

1. Have a strategy for a couple of different market conditions. Such as a strategy to range trade and a strategy to trend trade.
2. The more MECHANICAL your strategy, the better off you are because it will remove the emotion and fear from your trades. Essentially it removes YOU (of which YOU are your worst enemy, well, maybe next to your BROKER) from the trade.
3. Having FAITH in your strategy is the most important thing, but that FAITH will require you to actually trade your strategy for a long time. You will need to back test it, and stick to it faithfully in order to establish the TRUE boundaries of your earnings using that strategy. For example, after 6 months and hundreds of trades using a range trading system you find/develop, you determine that your system will yield you a 65% win rate and 35% loss rate with an average monthly earnings percentage of 3.5% of your account balance assuming you reinvest profits and don't take withdrawals.
4. Now that you have that benchmark data to work with, you are now 3.5% closer to your goal of 10% per month. Do the same thing with different strategies and keep working towards your goal... or be happy with 3-5% per month.

Having said all that... is 10% per month REALISTIC? That depends on you. If YOU will work in the right way to get to that end result by focusing on the SYSTEM you use rather than on flippantly trading your money in an unforgiving market and hoping for the best, then yes, I would say 10% is attainable. But it certainly is NOT attainable if you don't approach it the right way. Trading currencies is serious business and if you treat it as such, you may indeed be successful.

~JC
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