“…Another reason, why so many traders lose and which you often read about, - unrealistic profit expectations. Many beginners are tempted into futures trading, seeing an advertisement in the press or on television, promising 200 — 300 percent of trading profits in just a few weeks or months. Easily disappointed, not reaching such profits, these players, in the end, leaving futures trading, in most cases, losing all the money in the accounts. On the other hand, some traders return to the trading game again and again, drugged by dreams of unrealistic profits.
So what is a realistic trading profit? During the 1990s, the average commodity stock generated less 10 percent per annum. People, the managers of these funds, not newbies. They have at their disposal all the imaginable power of computers and trading systems.. What about the performance of commodity futures trading advisors? (WHAT)? In a recent article in “Wall street journal” pointed out: From January 1990 G. to August 1998 G. STA's average income was 11,1 percent. In fact, the information about these profits is not entirely correct and exaggerated., since funds and STA, incurring losses or going out of business, are not required to report their profits.
We often hear about unusually high profits. “turtles” (turtles), trained by the legendary Richard Dennis. In the June issue of the magazine “Futures” behind 1998 year published an article about their income in the 1990s. In the programs of eight “turtles”, still managing capital, in December 1991 G. invested hypothetically $1.000. This combined investment in $8.000 grew by February 98th to $19.157, which corresponds to the average annual income 15,27 percent. Interesting enough, that these $8.000, nested in half (on $4.000) to the trading programs of Richard Dennis and Bill Eckhardt, have grown to 335.577, meaning an impressive average annual profit in 27,38 percent. (Eckhardt is the same guy, arguing with Richard Dennis, that a trader cannot be taught to succeed.)
What about the wild and unknown world of hedge fund managers and their gigantic profits?? Journal article “Forbes”, written by commentator David Dreman, placed the efficiency index 2,600 hedge funds (1.500 local; 1.100 international), courtesy of Van Hedge Fund Advisors of. Nashville, PCS. Tennessee, After deducting bills, issued by hedge funds, their average annual income from January 1993 to October 1998 was 13,4 percent. It is less, how 19,9 percent return S&P 500.
Many years ago I read an article in “Wall street journal” about the earnings of the greatest traders and investors of all time, including Warren Buffett, Peter Lynch, George Soros and John Neff. Their long-term average annual returns ranged from 27 to 35 Percent.
With the profitability of commodity funds in front of my eyes, WHAT, hedge funds and legendary traders and investors, foolishly believe, что средний trader может удваивать и утраивать свои деньги каждый год….”
Smith G. “How do I play and win on the stock exchange”
