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It's a business.
You write off as much as you can during the year,
just as you would any other business.
60/40 Tax treatment on futures accounts helps as well.
mike ball
--- riccardo@xxxxxxxxxxxxxxxxxxxxxx wrote:
> Gentlemen, what about taxes paid each year... there
> is not a way to avoid that and this affects
> compounding big time.
> Regards
> Riccardo Ronco - FBR London
>
>
>
>
>
> > Message date : Sep 24 2004, 11:01 AM
> > From : "mike ball"
> > To : "Jimmy" , "Gary Fritz" , "Omega-List"
> > Copy to :
> > Subject : Re: Re[2]: system trader
> > J-
> >
> > Yes, I agree. That is really what I'm experiencing
> > in trading full time for a living. I don't make
> much.
> > I sweep my futures account each month.
> >
> > I agree with Gary, insofar as it is "difficult" to
> > compound. Not impossible. I trade next to quite a
> > few successful traders each and every day now
> who've
> > done just that.
> >
> > Living expenses is definitely a key point to
> watch.
> >
> > But if you have CONSISTENT results with 2 contract
> > plays on a 10k account getting to 4 contracts and
> then
> > beyond is completely doable.
> >
> > m
> >
> >
> >
> > --- Jimmy wrote:
> >
> > > Years ago I lived in Crawford, Yep where the
> > > President's ranch is.
> > > My neighbor had a pretty nice size spread and
> one
> > > day I asked him how
> > > ranching was doing. He told me you need to have
> > > your income worked
> > > out before you go into ranching. Trading is kind
> of
> > > like that isn't
> > > it?
> > >
> > > Jimmy
> > >
> > > Friday, September 17, 2004, 10:17:26 AM, you
> wrote:
> > >
> > > >> I find it an incredible ever repeating cycle
> > > >> that there exist so so many undercapitalized
> > > would be
> > > >> traders that have such supposed "really good"
> > > systems.
> > > >>
> > > >> If what you have is truly good, aka:
> CONSISTENT.
> > > You
> > > >> won't need help for very long. Compounding
> will
> > > stomp
> > > >> out the problem of undercapitalization.
> > >
> > > GF> Try living on the fruits of your compounding
> if
> > > you start out
> > > GF> with $1. Make 50%, 100%, 1000% a year,
> doesn't
> > > matter -- there
> > > GF> still isn't enough to buy groceries.
> > >
> > > GF> Compounding works great when you have a
> > > decent-sized account, but
> > > GF> ***ONLY*** if you don't have to bleed it for
> > > living expenses,
> > > GF> taxes, etc. If your trading is your only
> source
> > > of income, then
> > > GF> you need a pretty large account. I wouldn't
> try
> > > it with less
> > > GF> than $250k, and $500k or more would be a lot
> > > better. (I *DID* it
> > > GF> with a $100k account, and returned over 50%
> for
> > > several years.
> > > GF> And by the time I paid taxes & other
> expenses,
> > > my account was
> > > GF> smaller after 2 years than when I started.
> And
> > > then you have to
> > > GF> have enough surplus to live through the
> > > inevitable dry spells...)
> > >
> > > GF> Even if you have some way to shelter your
> > > account from tax and
> > > GF> other expenses, compounding can seem
> maddeningly
> > > slow if you
> > > GF> start out with a small pile. We all know
> > > markets change, and a
> > > GF> system that works now might not work forever
> --
> > > or you might just
> > > GF> prefer to retire 5-10 years sooner if you
> could
> > > find a way to do
> > > GF> it. Someone with a $10k account and a 50%/yr
> > > system might not
> > > GF> want to wait for 12 years for his $10k to
> turn
> > > into $1M. If he
> > > GF> can make $20-50k a year selling his signals,
> > > without compromising
> > > GF> his results, he has a way to grow his
> account
> > > much faster than
> > > GF> 50%/yr, and reach his goal MUCH sooner.
> > >
> > > GF> Undercapitalization IS a real and serious
> > > problem, no matter HOW
> > > GF> good your system is.
> > >
> > > GF> Gary
> > >
> > >
> > >
> > > --
> > > Best regards,
> > > Jimmy
> > > mailto:jhsnowden@xxxxxxxxxxxxx
> > >
> > >
> > >
> >
> >
>
>
>
>
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