Exchange Earning Ceilings

[Morbius]

Hi guys,

I just have something to ask that has been on my mind for a while and is linked to another thread that I read but I wanted to have a more involved discussion on it. Now I am aware that this is somewhat hypothetical for someone like me who isn't a successful trader and is theoretical too. I have heard some people say that 5% return per day on their original bankroll is more than achievable.

However given the liquidity issues that will certainly come into play at some stage, my question is at what stage will 5% be no longer possible and the wage for want of a better term will simply be a flat amount with fluctuations? So for example for someone who starts with say £1000 and was making £50 per day, at what stage would 5% be no longer possible....£3k, £5k, £10k etc.

I am also interested to hear if some guys have found some ways to increase their turnover by using related strategies or even using other exchanges to prolong this process.

[Euler]

You don't need a big bank to make a lot of money, just you need to use it a lot.

https://youtu.be/0ILbkdZpVps

So broadening strategies and using different ones in different markets is the way to bump up the next figure. You would be amazed at what you can do with a small bank.

[Morbius]

You don't need a big bank to make a lot of money, just you need to use it a lot.

https://youtu.be/0ILbkdZpVps

So broadening strategies and using different ones in different markets is the way to bump up the next figure. You would be amazed at what you can do with a small bank.

Hi Peter, yeah that was what attracted me to the possibility of the exchanges even though I am very late to the party so to speak. The leverage that can can obtained from tiny sums of money is very good and a different type of leverage to financial markets which is in my opinion far more dangerous if it isn't handled properly. A £1K bank in currencies shouldn't really mean you trade higher than micro lots unless you are basically gambling.

But more specifically Peter I was interested in how rapidly you would hit a ceiling on the exchanges starting with a £1k bank as an example and increasing daily by 5%. Equity Curve Simulators obviously tell a distorted story because they don't allow for liquidity ceilings but was just asking for opinions on this from experienced heads.

[Morbius]

Actually Peter I know this is a different question but I felt it didn't really merit an entire thread but how would you assess turnover as a trader on the exchanges?? I know this is hypothetical really as its profit that counts. As a backer the turnover is simple but as a layer at say 4.0 for £100....is your turnover £100 because you intend to close the position or £300 which is what it would be had you taken an outright position like a bookmaker.....just curious

[Euler]

I actually analyse my net exposure when I trade to check if I am trading efficiently. But you can achieve some massive returns on small capital, it just doesn't scale up.

If you gave me £1k I could double it easily in a week and probably go much higher depending on what was on. But if you gave me £10k I'd give most of it back, or still it in a deposit account as I wouldn't need in.

If you participate in longer-term markets like the US President then you need more capital, but a lot of what you need will come down to your trading style.

[Euler]

Actually Peter I know this is a different question but I felt it didn't really merit an entire thread but how would you assess turnover as a trader on the exchanges?? I know this is hypothetical really as its profit that counts. As a backer the turnover is simple but as a layer at say 4.0 for £100....is your turnover £100 because you intend to close the position or £300 which is what it would be had you taken an outright position like a bookmaker.....just curious

I count stakes as the turnover

[Morbius]

Actually Peter I know this is a different question but I felt it didn't really merit an entire thread but how would you assess turnover as a trader on the exchanges?? I know this is hypothetical really as its profit that counts. As a backer the turnover is simple but as a layer at say 4.0 for £100....is your turnover £100 because you intend to close the position or £300 which is what it would be had you taken an outright position like a bookmaker.....just curious

I count stakes as the turnover

Thankyou for taking the time to answer, I wasn't wrong by joining this forum and have been helped tremendously and its only been 48 hours. Unfortunately not all forums are as helpful as this one from past experience.

[Morbius]

I actually analyse my net exposure when I trade to check if I am trading efficiently. But you can achieve some massive returns on small capital, it just doesn't scale up.

If you gave me £1k I could double it easily in a week and probably go much higher depending on what was on. But if you gave me £10k I'd give most of it back, or still it in a deposit account as I wouldn't need in.

If you participate in longer-term markets like the US President then you need more capital, but a lot of what you need will come down to your trading style.

Peter, by "net exposure" are you referring to the conventional meaning of long positions vs short positions?? If so I assume you are trading both sides of the book simultaneously

[Kai]

Wasn't aware Euler was doing a Q&A

However given the liquidity issues that will certainly come into play at some stage, my question is at what stage will 5% be no longer possible and the wage for want of a better term will simply be a flat amount with fluctuations? So for example for someone who starts with say £1000 and was making £50 per day, at what stage would 5% be no longer possible....£3k, £5k, £10k etc.

I am also interested to hear if some guys have found some ways to increase their turnover by using related strategies or even using other exchanges to prolong this process.

Not much use looking too far ahead or spending too much time theorycrafting. You can start by making £5 per day, sounds ridiculous but that alone may take years to do, before aiming for £50 a day or worrying that the exchange may not be liquid enough to quench your appetite

The markets are liquid enough, your "earning ceiling" will depend on your strategy. You can try to force whatever number you want but your averages will form on their own regardless, and will be a direct reflection of your trading ability and comfort zone. Both have to be pretty high to reach some of the higher ceilings.

[LeTiss]

Actually Peter I know this is a different question but I felt it didn't really merit an entire thread but how would you assess turnover as a trader on the exchanges?? I know this is hypothetical really as its profit that counts. As a backer the turnover is simple but as a layer at say 4.0 for £100....is your turnover £100 because you intend to close the position or £300 which is what it would be had you taken an outright position like a bookmaker.....just curious

Don't sound so apologetic, it's a very reasonable question. I have an Excel workbook for my P+L, and do include stakes and liabilities for each trade. Having a £100 B2L on a 6.20 selection will produce far greater rewards than a £100 liability L2B on a selection at 6.00. Including liabilities, I find gives a more accurate calculation for my ROI%

[Jukebox]

I've no idea of the market's possible ceiling but it definitely offers a bottomless floor.

[Kai]

Don't sound so apologetic, it's a very reasonable question.

It's a common strategy to squeeze out as many potential questions as one can And a profitable strategy at that!

(I only mean that in a light-hearted manner)

[Morbius]

Actually Peter I know this is a different question but I felt it didn't really merit an entire thread but how would you assess turnover as a trader on the exchanges?? I know this is hypothetical really as its profit that counts. As a backer the turnover is simple but as a layer at say 4.0 for £100....is your turnover £100 because you intend to close the position or £300 which is what it would be had you taken an outright position like a bookmaker.....just curious

Don't sound so apologetic, it's a very reasonable question. I have an Excel workbook for my P+L, and do include stakes and liabilities for each trade. Having a £100 B2L on a 6.20 selection will produce far greater rewards than a £100 liability L2B on a selection at 6.00. Including liabilities, I find gives a more accurate calculation for my ROI%

Hi Le Tiss, I am probably exchange dumb but I didn't understand what you meant by "far greater rewards"

[Morbius]

Don't sound so apologetic, it's a very reasonable question.

It's a common strategy to squeeze out as many potential questions as one can And a profitable strategy at that!

(I only mean that in a light-hearted manner)

I do feel a bit awkward already Kai lol

[Morbius]

Wasn't aware Euler was doing a Q&A

However given the liquidity issues that will certainly come into play at some stage, my question is at what stage will 5% be no longer possible and the wage for want of a better term will simply be a flat amount with fluctuations? So for example for someone who starts with say £1000 and was making £50 per day, at what stage would 5% be no longer possible....£3k, £5k, £10k etc.

I am also interested to hear if some guys have found some ways to increase their turnover by using related strategies or even using other exchanges to prolong this process.

Not much use looking too far ahead or spending too much time theorycrafting. You can start by making £5 per day, sounds ridiculous but that alone may take years to do, before aiming for £50 a day or worrying that the exchange may not be liquid enough to quench your appetite

The markets are liquid enough, your "earning ceiling" will depend on your strategy. You can try to force whatever number you want but your averages will form on their own regardless, and will be a direct reflection of your trading ability and comfort zone. Both have to be pretty high to reach some of the higher ceilings.

I can't help looking ahead, old habits I guess Kai but I am trying to get all my questions answered (if that's even possible) before I commit to trading larger amounts but just hope I don't annoy anyone