Hello traders,
What is your typical ROI per month or year?
Unfortunately there is no typical ROI per month or year, even the professionals have years where they make money and years where they lose money. If I had to give a figure I would say that if you were in the single digits profit percentage wise then you are considered successful. There are several reasons for this which include you will not be right all the time and you can only take what the market gives. So, if the market gives you 1% (after leverage etc…) then the most you can profit that month is 1% regardless. It is sort of like asking an artist how much they make per month, the answer is “it varies”.
There are standard numbers for everything, but the world wants you to believe they don’t exist, but they do exist, the standard benchmark is 1-2% return on capital per month, above this number the markets work very differently and very few can succeed, they are designed to make sure you lose.
Now, today for example I made the same $ profits using $4,000 capital that you would need $1million capital to achieve using that benchmark, but there are some very specific dynamics which exclude you being able to achieve that without the $1mil capital.
You need to understand the markets are designed that you have a 92% probability of loss 92% of the time leaving the profitable intersection at 0.64%, hope is the last bastion of the human race which allows most people to lose most of the time expecting a different result.
Your target is 1-2% per month, now no one I know likes keeping $1mil in brokers at the whim of the markets, and one day if you ever understand the fabric of the human race you will follow the same path.
I think not more than 10-15% average. Although I am not focused on the average yield, more on the risk management.
I try to make as few losing deals as possible. After my percentage of losing deals will be acceptable I will focus more on making profits.
Is that per month or year?
I’ve had a little fun fun now and then playing with strategy performance statistics to calculate ROI. These figures have been posted before.
Let’s suppose you have a strategy.
Will it allow 20 trades a month? Of course - that wouldn’t be exceptional for a long-term trader: a day-trader will do that in a week.
Does it achieve a win rate of 55%? Of course. Many traders won’t even bother with any strategy that is as low as this figure.
Does the strategy only require a capital risk per trade of 1%? Yes. In fact this is a very cautious amount of risk.
Do the trades have a risk:reward of 1:1.5? Of course. 1.5 is not at all ambitious.
So just look at the annual ROI on this modest strategy.
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