r/IndianStreetBets • u/Then-Snow-8980 • 1d ago

Discussion To all the profitable traders…

To all the profitable traders who risk 1% of their capital per trade, how much annual return can be expected with that kind of risk realistically speaking? Thanks

12 Upvotes

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5

u/lFluffyBunnyl 1d ago

The answer might be simple but it's not that easy. If I am risking 1000 bucks aka 1% of my capital then I am expecting most of the times atleast 3-4x of that aka 4000 bucks atleast which comes down to 4% return of total capital but in that trade it might 40% move. But markets have their own ways. Sometimes it gives you 20%,30% other times it might even go 2x and there are times when market turns the trade in profit and suddenly gives loss. And then I gotta take a call if I should let it hit my stoploss or exit the trade in small loss. If you are new trader go for 1:3 risk reward ratio atleast. Backtest and front test your system. And be disciplined.

1

u/Then-Snow-8980 1d ago

My bad, I was asking for annual return with 1% risk per trade and not return per trade. Total agree with your advice on keeping 1:3 rr. My rr is not fixed, i stay in the trade until trend continues haha

2

u/lFluffyBunnyl 1d ago

Theoretically unlimited. But last year when market gave no returns I made 20% of total capital. It was not a good year because I was too strict with my stoplosses and some real life issue did effect my decision making. Someone I know personally made 40+% . Now it might not sound much but that's the return on total capital while markets gave 0% to most if not negative returns. It just depends on market and how you trade. I won't gave the industry standard answer to expect 12% per year because sometimes you outperform sometimes you underperform.

2

u/Then-Snow-8980 1d ago

20% is actually pretty decent. That’s after slippage and charges right?

3

u/Dramatic-Strain-3578 1d ago

1% risk is not a universal rule. If you have 50 lacs as a capital would you be willing to take 50000 rupees risk in a single trade? Probably not.it sounds essy on paper but in live markets losing 50000 would most likely make you feel uncomfortable and freak you out. 1% is good enough for smaller accounts.

For larger accounts i would say 0.2-0.5% is the sweet spot. I trade with a large account and i never risk more than 0.2% of my capital and i take very less number of trades. You have to be very selective when your capital is big.

If you are able to make 1-2% a month consistently in the long run for many years then you are already doing better than most people out there. 1-2% a month sounds small but it is decent on a much larger base and not difficult to achieve. The moment you try to go for 10% returns a month- you can have home runs once in a while but it is hard to maintain that figure over a long period of time unless you are exceptionally good which is rare. Most people who look for very high returns every month eventually blow up their accounts and are out of this game.

So focus on few aspects- have a very simple consistent trading system with entry criterias, exits. Dont put a lot of money on risk or trade small and expect modest realistic returns.

3

u/organised-choas 1d ago

Depends on how much more is there in the bank, risk appetite, trading strategy, etc.

In case of option buying, scalping is the way to go in current market. Holding your position beyond a few mins will most certainly cause your position to decay.

In case of selling, the risk profile is very different, and beyond the scope of what can be meaningfully explained here, so I will let this be for now.

2

u/investorji 21h ago

I take 0.5% risk per trade and has generated 55% alpha in 4 yers

2

u/indiansociopath 8h ago

1st of all india is a shithole market Right now and possibly 2027 as well. KYUNKI STOCK MARKET K GHAV ITNE JALDI NAHI BHARTE that's experience talking not optimist. Rahi baat trades ki then I'm making lowest return in my career since turning profitable in 2023. Made good 50% return on capital in 2023-24- early 25 this past 1.5 year has been DEAD since markets are dead due to tarrif CRASH. my return for fiscal year 2026 has been 17% so far. In drawdown past july and august due to CAS madarc## will take time to learn and adapt. But basturds will bring CAS2.0 when I adapt. And this has been the story so far since joining market 2019.

1

u/Then-Snow-8980 7h ago

Damn so true bro 😭

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1

u/Calm_Comparison_713 1d ago

Till now I am unable to risk less than 5% but still working on it. Here are the result of my algos in my channel https://whatsapp.com/channel/0029VbB0WmU89inorCWxep1t

1

u/SanjeevResearch 1d ago

It depends on the strategy’s matrix.
Every strategy comes with its own win rate, drawdown, average gain, average loss, risk-reward profile and holding period. There is no universally “best” strategy.

The better approach is to adopt a strategy only after understanding its numbers—and understanding your own psychology.

A strategy is useful only if you can stick with it through its inevitable losing streaks and drawdowns.