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How to make a living with trading?

  • #21
  • Mar 17, 2017 9:44am Mar 17, 2017 9:44am
Quoting Tom81
If you want to be full time trader your trading account should not be smaller than 50K and you should have 20-30K spare money to cover your living expenses while growing your account to 100K or more. Then you can start thinking of living from trading. Stop dreaming of making constant 100% yearly profit, 40 % yearly profit is top notch result, every investment bank/hedge fund would want to employ you, even 20 % is very respectable.
Exactly. I agree 100% with what you wrote.
But my problem is still with how to get to first 50k. Understandably noone will just give it to me. That is why my original question was how can I prove myself, where to turn to (or who) ... Constant 100% profits are just a fiction. I would gladly reduce risk with a bigger budget and get 20% yearly profit. But as i said. Noone will take me seriously even if i can make 4k from 2k in 2 years (50% profit/yr). That is the shit im talking about.
  • #22
  • Mar 17, 2017 9:46am Mar 17, 2017 9:46am
Insider Information
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Quick Answer:
If you want to be an institutional trader you need:

  1. 5 years of trading record
  2. 5 years your journal trading records
  3. trading with a minimum of $500,000
  4. Or have grown your small account to at least $500,000 - $1M

Every firm are open to a new trader position. And every year, there are tens of thousands of applicants. What makes you stand out of 10,000 applicants, where only around 100 seats are available? I'm sorry to burst your bubble, but a 50% return a year with a $9k fund is nothing special. Its a common mental bias we all have to think we are special than the rest. And then reality hits you, when you're sitting at that job application room and the guy next to you is averaging +200% and more for the past 5-10yrs, taking a $1K account to $1M. You can go to any firms and without those 4 bullets points I mentioned above and you will see them yawning at you.


Just for everyone's entertainment, let me spill some beans

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What you see in movies, that makes you think "that's just fucked up!", it doesn't even comes close on how corrupted and how dirty the day to day operations are. Call it conspiracy but every firm... Yes I said "Every firm" cooks their books. The public information have been cooked, earnings are cooked, everything is cooked... To evade taxes, to pocket more profits or to justify losses to customers.

What you see as public information such as firms averaging only 10-15% a year is BS. They make more than that, but they only pass on that much to their customers, and they pocket the rest. Seriously genius'; a firm makes more money pocketing +100% returns than giving investors 100% return and taking away performance fees and other fees. Do you really think Cops who confiscated $5M drug money will turn in all of it and would prefer a badge of honor and continue with an average yearly salary. They pocket $4M and turn in the $1M. Its no different in Finance, they pocket the bigger chunk.

If your trading FX and you're averaging 10%-20% a year, you don't know what you're doing and are clueless, naive in every sense of the world and it's realities. If you hang around poor people you will get the sense of their mode of culture/thinking. If you hang around middle class, you will get the sense of their mode of culture/thinking. It is the same if you happen to hang around rich people. You will see the differences between the 3 mode of classes in their thinking and actions.

The forums are littered with "Aiming for a 10%-20% yearly return".
The reality is, if you get a second part time job, you will make more than the 10% you are aiming for.

The forums are littered with "I only need a bigger fund to trade, somewhere around $200k-$1M".
The reality is, if you have that amount of funds and you can only generate a 10% out of it, then you are making a poor choice. If you have that amount of fund it is better invested in a brick and mortar business that will yield higher than your trading skills. Rich people don't invest in trading to make money, the put their money in trading because they have nothing better to do. Rich people prefer less risk than trading, they by a product a from China and sell it for a 100-300% markup price. 1M with 300% in 3 months with very little risk. Poor people don't know this, and Rich people invest in brokers and tell poor people that their financial freedom is through trading. Financial freedom is attainable in trading which has a very small window, and that's the reality of it. It's no different asking poor people what would they do with $1M... they don't know what to do with it.

The forums are littered with "I've never seen such high performance and unicorns, where are the proof?"
Well that just sucks doesn't it!!! that you don't see rich people with money and not curious enough where they got their money from.
I live in Australia and here is an example; Let say I have a $5M trading account and I am making only 10% a year. That's $500K minus tax (general) and you are left with $250k a year. If you invested that $5M in other things, you would make an easy 50%-100% return minus tax and you are left with $1.25M to $2.5M a year. You're an idiot having a $5M trading account making 10%. Rich People who have a $5M trading account have nothing better to do.

The problem lies with people being dumb and naive. The world's educational system wasn't designed to expand your intellect, rather to train you to regurgitate information. That's why people believe in a religious leader incapable of doing no wrong. People believe that Government leaders serves our best interest. And in according to this topic, people believe that they are getting good and fair services from financial firms.

The real fairies and unicorns are poor traders thinking they need a bigger account to trade. The real fairies and unicorns are making 10% a year and setting the bar at 10%. Mankind is capable of going to the moon, capable of climbing the highest mountains, capable of creating a vast empires, capable of technological advancement... And as unfathomable to ponder mankind's achievements... Making 100% and more a year consistently in trading is nothing really extraordinary.


Peace,
CrucialPoint
  • #23
  • Mar 17, 2017 10:25am Mar 17, 2017 10:25am
Do you know Melania Trump or any of her relatives?
used to be undecided but nowadays can't make my mind up
  • #24
  • Mar 17, 2017 10:44am Mar 17, 2017 10:44am
I agree with CrucialPoint, it is all a matter of perspective.

In my opinion (again, take it as a joke if you want) it does not make much sense to "risk only 10% of your capital" for example.

If you have 1million usd in your account, and you are going to risk max 100k of them, you can as well withdraw the other 900k and stay with a 100k account and risk it all.
  • #25
  • Mar 17, 2017 11:06am Mar 17, 2017 11:06am
Quoting PiranoTrader
{quote} Exactly. I agree 100% with what you wrote. But my problem is still with how to get to first 50k. Understandably noone will just give it to me. That is why my original question was how can I prove myself, where to turn to (or who) ... Constant 100% profits are just a fiction. I would gladly reduce risk with a bigger budget and get 20% yearly profit. But as i said. Noone will take me seriously even if i can make 4k from 2k in 2 years (50% profit/yr). That is the shit im talking about.
all depends on your drawdown, when you have about 50 % drawdown , noone would take you serios. then the account killer possibility is to high. its possible to do this with private money and hold many money back, but investing many money in this strategy would be stupid.

so when you need lets say 10 % drawdown per year from your annual wins, thats a good factor, but not many people get this factors. for many even 2:1 or 3:1 is a good factor, depends on the experience in the market. many have often a very high drawdown when they use martingale and open orders again when in minus or by not using SL.

a very high win/drawdown factor is a good chance to live with market gaps, flash crashs, big events,... and survive and earn same time with a high chance.
  • #26
  • Mar 17, 2017 11:19am Mar 17, 2017 11:19am
Quoting tunera
I agree with CrucialPoint, it is all a matter of perspective. In my opinion (again, take it as a joke if you want) it does not make much sense to "risk only 10% of your capital" for example. If you have 1million usd in your account, and you are going to risk max 100k of them, you can as well withdraw the other 900k and stay with a 100k account and risk it all.
thats the problem in trading: you need to have the possibility to survive big events, flash crashs, big spike moves, ....
if you only have enough money in to survive the normal SL, and one big flash move is coming, you have to pay the broker the difference too, and this could be many many money. so you need to hold this money back for this event.

there is only one advantage in your strategy, you have less money inside this broker. but you can change to a big broker, or simple use bank guarantee from your house bank for this broker, so this part is not so important or even bether to solve with even much less risk.
  • #27
  • Mar 17, 2017 12:38pm Mar 17, 2017 12:38pm
Quoting CrucialPoint
Insider Information {image} Quick Answer: If you want to be an institutional trader you need: 5 years of trading record 5 years your journal trading records trading with a minimum of $500,000 Or have grown your small account to at least $500,000 - $1M Every firm are open to a new trader position. And every year, there are tens of thousands of applicants. What makes you stand out of 10,000 applicants, where only around 100 seats are available? I'm sorry to burst your bubble, but a 50% return a year with a $9k fund is nothing special....

Hehe, ok. If i understand correctly every thing we see is just Potemkin's village for us poor idiots trying to make a few bucks, right. For you apparently it is not worth the trouble if i don't have at least 500k ...
Please be so kind, show me how making 100% or more a year consistently in trading is nothing extraordinary. Please show me the guy averaging 200%+ for the past 5-10 years. And please tell me about all the other businesses where making 300% in 3 months with very little risk is no problem. Or is this only reserved for the elite? You must be one of them knowing all the insider information.

Come on, get serious.

Im fully aware that this business is filled with crooks and scams. Most crooks say that "100% or more a year consistently in trading is nothing really extraordinary". Tell me, are you one of those Myfxbook or Fxstat scammers with fake accounts promising 100%+ profits? You sure write like one.
  • #28
  • Mar 17, 2017 12:43pm Mar 17, 2017 12:43pm
Quoting mrcreosote
Do you know Melania Trump or any of her relatives?
No, but Slovenia is so small that it would be totally possible
  • #29
  • Mar 17, 2017 1:04pm Mar 17, 2017 1:04pm
Quoting PiranoTrader
{quote} Hehe, ok. If i understand correctly every thing we see is just Potemkin's village for us poor idiots trying to make a few bucks, right. For you apparently it is not worth the trouble if i don't have at least 500k ... Please be so kind, show me how making 100% or more a year consistently in trading is nothing extraordinary. Please show me the guy averaging 200%+ for the past 5-10 years. And please tell me about all the other businesses where making 300% in 3 months with very little risk is no problem. Or is this only reserved for the elite?...
dont take "crucial point" post serios. he dont know better or is just joking. of course every year 100% return was stupid from him. this is maybe possible with very very small account in first years, but if you do it constantly every year, you have after some years more money in your pocket then is printed on earth ;-). he is maybe trading very small accounts and dont know how difficult it is trading much higher values by having much increased spread, slippage,... and problems to have enough counterpart volume in market.

noone who has basic knowledge in math would tell other that 100% each year over many years is possible, because its not even possible by math calculation, and when you know the reality (much higher slippage, spread, volume problems, very big problems coming out in fast moves with big volumes......) then you would never ever think about anything like that.
  • #30
  • Mar 17, 2017 1:08pm Mar 17, 2017 1:08pm
Quoting dukas_trader
{quote} dont take "crucial point" post serios. he dont know better or is just joking. of course every year 100% return was stupid from him. this is maybe possible with very very small account in first years, but if you do it constantly every year, you have after some years more money in your pocket then is printed on earth ;-). he is maybe trading very small accounts and dont know how difficult it is trading much higher values by having much increased spread, slippage,... and problems to have enough counterpart volume in market.
I know. I don't take it seriously. But he's just messing up the tread
  • #31
  • Mar 17, 2017 1:14pm Mar 17, 2017 1:14pm
Quoting PiranoTrader
{quote} I know. I don't take it seriously. But he's just messing up the tread
its positive he writes this extreme mistakes. so you know he is still a very beginner/rookie trader and you know that his trading level is very low and you can judge his thoughts much more easy. he will learn with time the basics and maybe when he tries some math lessons he can easy see his mistakes by own and improves his basic market knowledge.

math will help extrem in trading, so its always good to have at least basic knowledge, better good knowledges.
  • #32
  • Mar 17, 2017 1:29pm Mar 17, 2017 1:29pm
  •  hak444
  • | Joined Aug 2016 | Status: knowing is not enough,we must apply | 41 Posts
100% or more monthly (consistently for more than 2-3 years)?
If that's some one saying then he/she is either stupid(and that's being nice) or a scammer


100% or more yearly (consistently for more than 2-3 years)?
Its possible to get such results for 2-3 years but consistently getting such results back to back for 5-6 years? Chances are less.

But i don't think that you need 100% or more to live a great life. If your starting capital is enough(relative) or you can use compounding, even 30%-40% is sufficient.

@PiranoTrader...Buddy if your consistently profitable, that is a great achievement in it self. Don't let others opinion discourage you.
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I can accept failure but i can't accept not trying. (Michael Jordan)
  • #33
  • Mar 17, 2017 1:55pm Mar 17, 2017 1:55pm
Quoting PiranoTrader
Anyone here with some experience from this?
I sympathise with the challenge of making a living from a small account, and I hope you can successfully overcome your challenges.

Having said that, I do not think that your account size is the problem. If you have been consistently profitable for some years, then your account shouldn't be small. Perhaps your returns aren't good enough?

Looking at your Trade Explorer certainly suggests that. Sharpe ratio of about 1 and return to drawdown just above 2.

Based on my experience with prop firms in the City of London I'd say that your chances of obtaining funding are zilch, if those numbers are indicative of your performance. And 1.9% so far in March, and we're half-way through this wonderfully volatile month....please, don't think of institutional funding based on that.

With all the sour grape posts about the impossibility of stellar returns, let me tell you about somebody I know. He put GBP20 in a spread-betting account in September of 2007. By Christmas the account had reached GBP10000....and he was keeping up a full-time job throughout that time.

So I would say the same thing to you as I say to myself after each trading day - how can you improve your trading?
  • #34
  • Mar 17, 2017 2:02pm Mar 17, 2017 2:02pm
Quoting medici
{quote} I sympathise with the challenge of making a living from a small account, and I hope you can successfully overcome your challenges. Having said that, I do not think that your account size is the problem. If you have been consistently profitable for some years, then your account shouldn't be small. Perhaps your returns aren't good enough? Looking at your Trade Explorer certainly suggests that. Sharpe ratio of about 1 and return to drawdown just above 2. Based on my experience with prop firms in the City of London I'd say that your chances...
stellar wins in this mini money accounts, ok thats easy and often done. try doing it some years and still have this performance with a much bigger account, that was the topic. find someone from this style, the other are easy to find, but many many lose also on the other hand because this one won.
  • #35
  • Mar 17, 2017 2:08pm Mar 17, 2017 2:08pm
Quoting dukas_trader
{quote} many many lose also on the other hand because this one won.
Exactly. Some people are winners and some are not. Those who aren't winners do not, per definition, understand what the winners do.

So let's leave the winners to the impossibilities of what they are achieving, and let's take an honest look at ourselves.
  • #36
  • Mar 17, 2017 2:24pm Mar 17, 2017 2:24pm
Quoting medici
{quote} Exactly. Some people are winners and some are not. Those who aren't winners do not, per definition, understand what the winners do. So let's leave the winners to the impossibilities of what they are achieving, and let's take an honest look at ourselves.
you need about 80-95% losers to have enough money left for some bigger winners. the spread needs to be payed too in this zero sum market. and because many winners are only some time winners (most lose all on the end again), its enough there to win. at least when there are still enough martingale and funny system traders out there.
  • #37
  • Edited 3:00pm Mar 17, 2017 2:32pm | Edited 3:00pm
Quoting dukas_trader
{quote} you need about 80-95% losers to have enough money left for some bigger winners. the spread needs to be payed too in this zero sum market. and because many winners are only some time winners (most lose all on the end again), its enough there to win. at least when there are still enough martingale and funny system traders out there.
Actually, in relation to the thread starter's question, you got it all wrong. None of that applies to his challenges.

It's a zero-sum game with costs, yes, but the market isn't a game of equal players. It's more like an eco-system - the individual trader can feed off of the institutional trader, much like the remora fish hanging out with the sharks just to eat the leftovers from the shark's feasts.

So, actually, the retail trader has things rigged in his favour.

Again, we just need to look honestly at ourselves.
  • #38
  • Mar 17, 2017 2:35pm Mar 17, 2017 2:35pm
Let me mess with this thread one more time
(and I will leave you guys)
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I actually gave you guys some solid advice. And since you guys have selective hearing and trapped in your own realities, I will reiterate my solid advice because it's a really valuable advice. So here it is in bold:

Since you have been profitable for so many years now.
There is nothing stopping you from going to any firm and asking for a trader position.
Go to any firm and show them your trading results.
And you are one step away from achieving your goals (becoming an institutional trader)....
Because clearly, according to your performances... Why wouldn't they hire you?

There are no ill-intent with my advice with that.
I told you the truth regarding the requirements, but unfortunately it was hard for you to swallow the truth


OK, let's do some Maths
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Hypothetically speaking you managed to round up a $500K trading account from people.
Let's say you manage to get 20% profit a year = $100K
How much are your fees? = 1-10% all management/performance fees >>> which is $10K in your pocket
I don't know if $10k and minus tax is enough to feed your family.
But Convert this $10K into Euros and it is still below the average wage in Slovenia per year.
So you gonna need more than a $500K account, and this plan is not looking good already.


Looking at your records you have 50% DD, I could be wrong.
So hypothetically, lets give you a 10% DD in 1 year
another 10% DD in the second year
let's say you make 10% in the third year
And then you make 10% in the fourth year
If you do the Maths, after 4 years, you are break even.
After 4 years, you've made nothing.
Tell me, which firm is going to hire you if you can't make anything in 4 years?
Tell me, how are you going to feed your family if you haven't made nothing in 4 years?


And Finally the magical +100% consistent yearly.
For some reason you guys think of compounding 100% consecutively for so many years.
That's why when you guys do the Math in your head results into billions and trillions which is not possible.

Well, real life traders don't compound it because they simply can't.
What happens is that$10M this year, next year $10M, the following year $10M, etc...
Thus, 100% consistent yearly for the past so many years.
And every trader who trade really big accounts knows it...
It's only the traders who never traded huge amount has this magical-compounded-Trillions of Dollar in their head.


OK genius' let me throw you a curve ball:
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Financial firm holds $500M in accounts....
A 10% profit is $50M
CEO earns $50M in salary.
Where do they get the money to pay all the employees/traders/investors and all business running cost?


Peace,
CrucialPoint
  • #39
  • Edited 3:22pm Mar 17, 2017 2:51pm | Edited 3:22pm
Quoting CrucialPoint
Let me mess with this thread one more time (and I will leave you guys) {image} I actually gave you guys some solid advice. And since you guys have selective hearing and trapped in your own realities, I will reiterate my solid advice because it's a really valuable advice. So here it is in bold: Since you have been profitable for so many years now. There is nothing stopping you from going to any firm and asking for a trader position. Go to any firm and show them your trading results. And you are one step away from achieving your goals...
ok lets start help you: you write some sentences like a medium trader, some like a beginner trader, difficult to say , do you are experienced or just a starter? but ok lets help you with fast seen mistakes:

you wrote: "Financial firm holds $500M in accounts.... A 10% profit is $50M CEO earns $50M in salary. " use your words as trading wins example!
you know to think step one, but as trader later in real live you need to see the whole game! when you have 10 % you get more money in and your money inside this financial firm is 550m with the wins and with new money even more. so your win next year is some percent less and so on and so on. you need to compound next year most of the time as financial firm, or you need to say, you dont let new money come in!!!!

the problem is: your own words speak against you, and you really need to think first about it. its not so easy to show you all mistakes because you look really new in real trading and you look like you never have seen big account trading in real live.

and by the way: if you would be a professional trader and not just a beginner, you would know some basics: like when you say 100% per year win you need to speak about all the money people have! not only the money in the account (this are only beginners doing [and looks like you do it so too]). if you say 100% you double all the money you had from beginning till end of the year. if you have some 200% in this account some 50% in this account or with risk capital in companies ,..... on the end its 100%. so if you putt money out and have 100 % again in this account is then not really 100% win (its only for this account whats not important), its much much less. its a big beginners mistake to calculate it this wrong. its difficult to call all your mistakes and teach you all this in proper way. maybe its more easy you find out basics by your own and later we can speak about the math. dont do this wrong calculation at least, so we speak same language, whats 100% win in 1 year! if you only speak about the money inside one account, then performance is easy to fake to many 100% in the year, simple put money out until you need till you Sl, and after you lost put again fast new in, and then wins out and so on. you get many many many percents win, but its not the true return someone has to his money. ok enough help, to correct some of your bigger mistakes.
  • #40
  • Mar 17, 2017 3:33pm Mar 17, 2017 3:33pm
  •  hak444
  • | Joined Aug 2016 | Status: knowing is not enough,we must apply | 41 Posts
@CrucialPoint.... Ok, your 2nd post has some valid points. Your 1st one was all over the place that's why i didn't read it first. But now after looking into the details i agree to certain points you made.

I don't know where this 10% per year is coming from but if that's some one's goal is to just achieve 10% per year then i agree its nothing .
What i don't understand is why you have to be a part of some financial institution to make big money? (plz elaborate this)
On the other hand i have seen people who have been part of these firms but now trade their own money and are very happy because of less stress and more independence.

I agree if you want a financial institution to hire you...you have to show them something, 10%-20% is not up to the standards (my opinion)

If you want to make a living from this business, just trade independently and go for 40%-50% (per year), which can be achieved with ease.
e.g... If your starting capital is 10k...let it grow to 100k (use compounding to get there fast). Now take a small portion out of this, lets say 20k and open another account. Now you can trade more aggressively on this 20k account while you trade that 80k account as usual and withdrawing profits quarterly or whatever period you wish to.
I mean the possibilities are endless. The idea is to just focus on 1 account and let it grow, once it reaches to a sizeable amount withdraw some then invest in another account, on which u can take extra risk.
On your major account you can expect regular income and your other account can also grow with the use of compounding and aggressive strategy (but not gambling)

And real traders do use compounding....that is why its called the 8th wonder of the world but not like many retail traders use it.
I can accept failure but i can't accept not trying. (Michael Jordan)
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