Calculating % Return

So I often get asked how much % I am up since I started trading and I always respond that I cant really answer that question. They in turn ask how I dont know my % return.

The problem: The amount of capital I am using to trade with is rapidly increasing. I have 4x the buying power now than when I started.

The approach I have been using to calculate my performance has been % return on average capital deployed. I want to accurately state my % performance but it seems difficult because My buying power has been rapidly increasing and because I dont use all my buying power.

Any thoughts on what method I can use to state my % performance?

 

Same boat, was trying to calculate this the other day but couldn't think of a reasonable methodology other then weighting which is hard given that i can't remember how much I put into each stock and when.

 

I know how to do the basic % return calculation.

I trade for a prop firm. As I hit P&L hurdles my buying power gets increased but my buying power and profit do not move linearly but more exponentially. The theory is if you can make money trading 100 300 500 shares you can do the same with 1k 3k 5k shares but you must first demonstrate you have an edge with smaller share amounts.

My question: Is calculating my return on the average capital deployed a fair approach of my % return since my underlying capital. If someone has a better approach I would like to know because something just doesnt seem practical the way I am doing it.

"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.

"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
 

At my last gig, client accounts would have massive swings in notional value (managed options accounts). But, as qwertyater was saying to some extent, if you did the basic % return calculation at each buying power level and then compounded said, it should give you a capital-independent cume return.

The only caveat to that is, if I'm reading you correctly, that your percentage profit actually depends on your buying power, e.g. you can make 10% on $10k but 25% on $15k? In that case I'm not sure how to approach it, total return versus average capital might be needed there.

 

Non tempore aspernatur aperiam sit exercitationem magnam. Deleniti id maiores cupiditate illum fugit. Voluptatum mollitia assumenda sequi vitae dolor error qui.

"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.

Career Advancement Opportunities

March 2024 Investment Banking

  • Jefferies & Company 02 99.4%
  • Goldman Sachs 19 98.8%
  • Harris Williams & Co. (++) 98.3%
  • Lazard Freres 02 97.7%
  • JPMorgan Chase 03 97.1%

Overall Employee Satisfaction

March 2024 Investment Banking

  • Harris Williams & Co. 18 99.4%
  • JPMorgan Chase 10 98.8%
  • Lazard Freres 05 98.3%
  • Morgan Stanley 07 97.7%
  • William Blair 03 97.1%

Professional Growth Opportunities

March 2024 Investment Banking

  • Lazard Freres 01 99.4%
  • Jefferies & Company 02 98.8%
  • Goldman Sachs 17 98.3%
  • Moelis & Company 07 97.7%
  • JPMorgan Chase 05 97.1%

Total Avg Compensation

March 2024 Investment Banking

  • Director/MD (5) $648
  • Vice President (19) $385
  • Associates (86) $261
  • 3rd+ Year Analyst (13) $181
  • Intern/Summer Associate (33) $170
  • 2nd Year Analyst (66) $168
  • 1st Year Analyst (202) $159
  • Intern/Summer Analyst (144) $101
notes
16 IB Interviews Notes

“... there’s no excuse to not take advantage of the resources out there available to you. Best value for your $ are the...”

Leaderboard

1
redever's picture
redever
99.2
2
Betsy Massar's picture
Betsy Massar
99.0
3
Secyh62's picture
Secyh62
99.0
4
BankonBanking's picture
BankonBanking
99.0
5
DrApeman's picture
DrApeman
98.9
6
CompBanker's picture
CompBanker
98.9
7
dosk17's picture
dosk17
98.9
8
GameTheory's picture
GameTheory
98.9
9
kanon's picture
kanon
98.9
10
Jamoldo's picture
Jamoldo
98.8
success
From 10 rejections to 1 dream investment banking internship

“... I believe it was the single biggest reason why I ended up with an offer...”