Is 10% per month unrealistic? wouldn't that double your account every year?

[Cdawg]

Let’s be conservative. Only risk 1% of the account per trade. For each $1,000 that would be $10. Keeping our stop loss tight at 10 pips gives us:

POSITION SIZE = RISK / STOP LOSS

POSITION SIZE = 10 / 10 = 1

We trade 1 mini lot. A 10 pip move in our favor yields a 1% gain. Do this once a day and you are making 5% per week.

In theory thats great, but realistically you can not trade with a 10 pip SL. Now if you have developed really good entry strategy, you might be able to get away with a 25pip SL… not to mention the fact you need to account for the spread…

So with one mini lot, your going to have to risk at least 2.5% on a $1k account… more likely 5-7% in order to give your trade room to develop.

Cheers

[o990l6mh]

Unfortunately, with internet forums you’re really down to what you choose to believe (although unless someone is trying to sell you something, there’s not much motive in fibbing).

Don’t forget the huge need people have to have their ego’s fed.

[profitforextrader]

I often hear this 20-30% a year target figure as being the big golden trophy. Yet there’s evidence to the contrary that there are small retail guys who are making considerably more.

For a fact, Martin Schwartz (Market Wizards, Pit Bull) was able to average a 25% MONTHLY rate of return when he was a retail trader, and he had a six figure account (every three months he’d put his profits away and start afresh). He sort of bombed when he began trading other people’s money, and realized he’s only good trading retail. Schwartz was a daytrader, he went for quick moves, in and out.

There are other examples in “Millionaire Traders”, and then there are numerous people who claim to reach such high percentages on internet forums. Unfortunately, with internet forums you’re really down to what you choose to believe (although unless someone is trying to sell you something, there’s not much motive in fibbing).

The only possible explanations that I can see are:

1. These high percentage traders are taking on very high risk and are teetering on the edge of a precipice (i.e. using Kelly Criterion or Optimal F money management instead of the 2% rule)
2. These traders have a small size which doesn’t move the markets, get good quick fills on their orders.
3. These traders are braver because their capital is smaller and the money is less “scared”, therefore they trade better with that money.
4. Trading an intraday strategy is more higher probability than a longer term swing strategy, the latter being what big money managers rely on.
5. They are retail traders and are more motivated to work hard than the guys who get paid a salary and work in an office 12 hours a day, trading what mostly goes into someone else’s pocket and they get a small piece of.
6. They are 10% of the 10% of those who succeed in trading

It would be interesting if we got some firsthand opinions of the consistent 5-10% a month traders here and let them share how they managed to do it, are they intraday, swing, how many trades a week, and what their maximum drawdown period is.

early this year my son was born, i dropped out of college and invested what little i had in the forex market that i had been studying for about a year

i consistantly made 10%+ PER WEEK for almost 9 months going from £400 - £30k

so IT IS doable but you will face countless psychological barriers

a couple weeks ago i just turned 19, was a little overexcited and made a wreckless trade resulting in a margin call leaving my account now at 15K, after some thought i decided to not to continue trading my account and am now in talks with a wealthy oil businessman who is interested in investing 100k in a forex account of which i will manage for a 35% performace fee

all it took was a little money and masses of determination and perseverance

as others have mentioned you are most likely to encounter losses for your first year but if you are determined to succeed in this business you will get there in the end

[Cdawg]

early this year my son was born, i dropped out of college and invested what little i had in the forex market that i had been studying for about a year

i consistantly made 10%+ PER WEEK for almost 9 months going from £400 - £30k

so IT IS doable but you will face countless psychological barriers

a couple weeks ago i just turned 19, was a little overexcited and made a wreckless trade resulting in a margin call leaving my account now at 15K, after some thought i decided to not to continue trading my account and am now in talks with a wealthy oil businessman who is interested in investing 100k in a forex account of which i will manage for a 35% performace fee

all it took was a little money and masses of determination and perseverance

as others have mentioned you are most likely to encounter losses for your first year but if you are determined to succeed in this business you will get there in the end

Congrats on your success… we all make a reckless trade now and then…

Though since you obviosly have a method that works, you’d be far better off using your 15k account and trade for yourself than the 100k investment…

at 10% per week, you have your own 100k in 6 months…

[TonyIommich]

i consistantly made 10%+ PER WEEK for almost 9 months going from £400 - £30k

so IT IS doable but you will face countless psychological barriers

Congradulations, even if you lost 50% of what you made, your return is amazing and you’ve probably learned so much that you’ll have it all back with profit soon enough

Tell me then, how did you go about it? I assume you studied the basics of technical analysis. How did you go about developing your system? Did you survey all the indicators and see which ones you liked? Did one system do it for you or did you have several? Do you consider fundamentals at all? Is your system intraday or swing?

How did you test it before going live? What kind of periods of drawdown did you endure? How did you deal with drawdown, did you change your system? What kind of money management do you use, do you stick to the 2% rule? How did you compound?

And on that last devastating trade, did you violate your risk rules?

Thanks for your input…

[jonnytrade]

1 Full month in and I have made 20% on this account. I am confident that I can continue to grow it further. Over the holidays may be a tricky time and I don’t expect to have the same success over the next month, but I am certain that I will succeed at my 10%/ month target over the next year.

I feel that I have had a real breakthrough over the last 4-6 weeks in Forex trading.

A couple pearls of wisdom that I have picked up in this time from wiser men, I can’t recall who they were…

“protect your capital protect your capital protect your capital protect your capital” (i repeat this mantra often during the day)

“The traders who succeed tend to have a series of very small losses followed by a big profit. Many think this is the other way round, that large losses can be recouped by many small profits … the easiest loss to take is the first and smallest…”

My breakthrough has not been to work out a system or strategy, I have not found any holy grail. I just finally started to listen to the ppl telling us to practice good money management:eek: Who would have thought I didn’t know everything…

I am posting this as a newbie for other newbies who may be in the same postion I was in… i.e not listening to those who know and refusing to start with the principles of risk management. This should be everyone’s first lesson. Forget about candlesticks, forget about fibonacci, forget about trends, technicals, fundamentals. Forget about currencies even, until we understand these key elements:

broker leverage
true leverage
useable margin
the 1% risk rule

At this point I would have to lose many many trades in a row even to lose my profits for this month. I am certain that if I can stick to the rules I have learned I might get somewhere.