Expectations

[[Deleted]]

Hi,

I have been paper (virtual) trading for a bit of time and developing systems, and I am willing to invest 3k, which can be leverage 50 times, is it reasonable to hope for 30 dollars for a trading day.

I figure its, $3,000 x 50 (leverage) = $150,000, and $30 expectation, $30/$150,000 = .0002 = .02% = 2 pips + spread

Based on your trading experience, is it reasonable? also, is my math correct?

Thank you for your time,

- Amit Sharma

[onewithzachy]

AmitSharma:

Hi,

I have been paper (virtual) trading for a bit of time and developing systems, and I am willing to invest 3k, which can be leverage 50 times, is it reasonable to hope for 30 dollars for a trading day.

I figure its, $3,000 x 50 (leverage) = $150,000, and $30 expectation, $30/$150,000 = .0002 = .02% = 2 pips + spread

Based on your trading experience, is it reasonable? also, is my math correct?

Thank you for your time,

- Amit Sharma

No, your math is dead wrong !!! so it's not reasonable and does not make any sense.

If you have $ 3,000 with 1 : 50 leverage and you trade EURUSD, and if EURUSD is at 1.30000 then the cost of buying 1 lot will be $ 2.600 (= 1.3000 * 100.000 / 50). You should also calculate stop out level before even making any trade, so you know where your margin call limit.

You should paper trade more :)

[[Deleted]]

Ah, right, first you have to convert USD, to EUR, and then for every 10,000 euro's, one pip movement would be equal to a dollar. So, $150k usd is about 114k euro's, so about 2.6 pips would equal 30 dollars. Or something like that.

eh, I was just wondering, I am still far from trading real money, I am backtesting, then I need to forward test, then trading with a small amount of money, I was just seeing if it was possible to make 30 dollars from 3k in the long run, the math isn't the important bit to me at this moment (I was posting on a whim and obviously fudged the math).

also, thanks for the .mq4 I will take a look at it

[dabbler]

AmitSharma:

, and I am willing to invest 3k, which can be leverage 50 times, is it reasonable to hope for 30 dollars for a trading day.

See this link for position size calculation

http://www.babypips.com/tools/forex-calculators/positionsize.php

Is it reasonable to expect $30 for a single trade with a $3000 account?

Yes. Risking 1% with a 1:1 reward/risk ratio is reasonable.

Is it reasonable to expect this $30 every day?

No. If your account were to grow 1% per day, compounded over 250 trading days per year that would be 1.01^250 = x12

You will win some and lose some and achieve some sort of averaged gain (or loss). If in your first year of trading you actually make a tiny profit or not too large a loss you should consider yourself fortunate. If you hope to increase your account by 25% per month then you will be disappointed.