Yes the title is bold, what’s even crazier is that I’m doing this challenge starting only with a 200$ deposit.
How do I plan on doing this? Slow and grow or fast and blow?
Coming from engineering school, I have learned to focus on process first then do system optimizations.
In a year we have roughly 250 days of trading which means about 50 weeks of trading available. Then we have to set our x limit which determines your end date. My end date is 3 years. I want to try to grow 200$ to $1M within 3 years time span. That means 50*3=150 weeks.
Using Forex21 compounding calculator, you can see that with an initial deposit of 200$, accumulating 6% compounding gain for 150 weeks, will supposedly generate $1.3M, minus fees and interest pricing.
Every week you have to maintain a steady 6% gain. This is nuts and basically impossible. Proper money management is crucial. However, I will be a bit more aggressive and over expose myself during my ramp up from 200$ to 1000$. Once I reach 1000$, I will be using more conservative settings because that’s when each trades will generate non-negligible income on weekly basis.
I will be using the following structure and ratio:
Now, just for your curiosity, why the 6%? Well if you did the same calculation but with 5% instead, this is how much you are losing:
That’s roughly 300k accumulated in 3 years instead of 1.3M.
This 1% decrease makes you “lose” $1M.
So how do you make sure you always reach that 6%? You use a script or EA which closes all your trades once the combine profit of each reaches 6% or 6.1% to cover interests and minor fees.
In my structure, my ratio is roughly 1/100 or for every 100$ I use 0.01 lots. The goal is to end up with 2 winning trades at 30 pips profit meaning around 60 pips weekly to maintain this 6% curve. Because I run multiple trades, my profit target is actually 3.1%, combine both and you have your 6% gain and some extras.