How to double a million?

What if someone gives you a million and orders you to double it anyway you like? What will you do with this million? :smiley:

It depends on what my rewards for success and/or penalties for failure are: as with any other kind of investment, trading or commercial activity, before making any decisions one needs to have a way of assessing to what extent risk-management is significant, and therefore how risk-adverse one should be in the circumstances; but you havenā€™t offered any information about the circumstances.

Okay, just to keep this game going, I will make up some rules.

Suppose ā€œan investorā€ places $1 million in your hands, [B]to trade/invest/gamble ā€” whatever.[/B]

[U]The terms of the deal are these[/U]:

  1. After one year, the investor wants his million back.

  2. If you succeed in doubling (or more than doubling) the million, then you can keep all the gains, after paying back the original million.

  3. If you succeed in growing the million, but fail to double it, the original million and all your gains will be paid to the investor.

  4. If you fail to grow the million, and instead lose a portion of it, then you will pay $1 million to the investor, and the losses are on you.

Ready, set, go.

Lexy, youā€™re up.

.

I would go all inā€¦ An order of 100 million - EUR/USD - 1: 200 Leverage, with as best technical analysis as I possibly can, probably enter on reversal at a 4 or 5 month high or low. This would leave me 500 k to cover the marginā€¦ I have an year, so would wait for the market to go 105 pips in the direction it needs to so I can make 1 million + in profits.

Thank you

On the basis of those rules for the deal (which are excellent ones!), Iā€™m afraid my answer isnā€™t helpful or even interesting to anyone else: Iā€™d probably give the funds to a good friend of mine who used to trade futures for one of the big investment banks in London and now trades her own account from home, on some kind of profit-sharing deal, because Iā€™d trust her with it more than I trust myself. So I might actually ā€œoutsourceā€.

Over a much [I]longer[/I]-term than one year, Iā€™d perhaps look at a joint investment in a buy-to-let property overseas, aiming at the ā€œembassy staff rental sectorā€ (embassies are very low-risk tenants for upmarket property and almost always pay the rent reliably), with an eye to capital appreciation more than the rental income itself. The problem here is that $1 Million isnā€™t necessarily enough to acquire a suitable property (though it perhaps could be in some countries where real estate prices have bottomed out and are now starting to rise again?).

I [I]could[/I] try to use the money for intraday price-action forex-trading of exactly the type I do now, but to double it in a year, Iā€™d need to make a steady-ish 6% per month, compounded monthly. And that would mean expert risk-management [I]and[/I] probably making it a full-time job (i.e. rather than the three days per week, with the occasional week off, that I do at the moment).

Sorry - your question deserved a more interesting answer than I offered.

Interesting question you pose. My solution would be Ben Franklin and compound interest. Sorry but my spreadsheet math is not cool enough to prove this point.

However if we extrapolate from the annual Trading Championships I think we can get some decent conclusions. But first they only start with 10K! so we would need to do some multiplication to even things up. Second by the standards set by previous champions Forex would not be the first choice of tools. Bottom line is the million would easily be doubled by many in most if not all trading disciplines on the list.

Now taking a cue from the fund, With sound money risk management a million could be doubled using the Funds Benjamin Formula for trading. The fund however sweeps the money over the funded account on a monthly bases so we donā€™t get to see the effect of the Ben Franklin compound interest miracle.

My plane is simple. Once funded (and at the Funds 100% leverage) in a few weeks I will take my wondrous earned income and deposit it in my own trading account (at 50% leverage) elsewhere (as you can not invest in the fund) that I open with a measly $1,000 and add to it monthly. Now my fund account is increased every 90 days of profitability up $250,000. (and Iā€™m not certain about this) in maybe ten stages.
We would also have to add in two other variables 1. the win-loss ratio of 80%, With 20 trades per day (not uncommon for our more experienced traders and 2. an expectancy of $30.00 per trade again not uncommon for the funds more experienced tradersā€¦

I would bet bet this makes a million in two years. However if I had a million for my own account doubling it by these ratios would happen faster than a year.

Remember with the compound interest formula and adding back in the daily profit at even a 50% leverage this is very attractive.

Just for fun!:laughing: all the way to the bank!

Happy Piping!

Hmm - Interesting quandry here !

Depends on oneā€™s own net worth currently I think.

12 months is not enough to do a property speculation and youā€™d probably need a few in any case to net Ā£1,000,000 from a Ā£1,000,000 starter - maybe not with good cash flow management - but as I said - a yearā€™s too short.

I think trading is not the way Iā€™d go - Iā€™m just nt good enough to guarantee a double in a year.

Your rules @Clint put all the risk on my side and a no risk, very ood odds gamble on the ā€œinvestorā€'s side.

I think if I was worth 1,000,000 or more - Iā€™d probably just decline the proposition.

If I was worth 500,000 or less, Iā€™d sell evrything I could lay my hands on max out the credit card and find a friendly casino owner - talk him into a single bet with a charged entry fee and possibly TV rights etc - It woud be great publicity for him

Then Iā€™d put everything I could lay me hands on, on a single spin of teh roulette wheel - RED oR Black.

Slightly less than 50-50 chance of the double of my 1.5 mill, but I only have 500,000 to lose against 1.5 mill to win

So Iā€™m getting 3:1 odds on an even money bet !

No Brainer ! :relaxed:

If youā€™re woth less than a half mill, the odds get way better and if youā€™ve not got a pot to piss in theyā€™re superb !

Win - Youā€™re wealthy - Lose - file for bancruptcy ! :slight_smile: