What 1% a day would really mean
A steady 1% a day compounds to nearly 38 times in a year. Here is the arithmetic, and why the result is not what a trading record looks like.
How this was made: an AI assistant drafted this guide under the operator's direction, and the numbers were checked against the calculators on this site. Nothing here is investment advice.
The arithmetic
One percent a day sounds modest. Compounded over 365 days it is 1.01365 = 37.78 times the start: 1,000 becomes about 37,783. That is a gain of 3,678% in a year.
Kept up for two years, it is 1,428 times, so 1,000 becomes about 1,427,588. After three years the multiple is 53,939, and after four it is 2,038,007, which turns 1,000 into about 2.0 billion.
How it compares with what we measured
The best backtest we found made +63% a year after costs, and we listed six reasons not to trust it: the best backtest we found. A steady 1% a day is about 58 times that figure. The yearly returns we measured across 31,407 indicator setups are in the backtest explorer.
Costs compound too
Take 0.1% a day for costs, a small figure on a strategy that trades daily. The rate that compounds drops to 0.9% and the year ends at 26.3 times, not 37.8. A cost of one-tenth of the return removes about 30% of the result. Try it in the compound growth calculator.
Averages hide swings
A strategy that averages 1% a day does not earn 1% every day. Suppose the daily moves swing with a standard deviation of 5%. The compounding rate is then about the average minus half the variance, 1% − 0.5 × 0.05² = 0.875% a day, and the year ends at 24.0 times, not 37.8. The more the results jump around, the more of the average is lost to the swings.
Size is a limit
A strategy that returns 1% a day on a small account may not return it on a large one, because large orders move the price against you, as the slippage calculator shows. At that rate an account would outgrow most markets within a few years, long before the strategy could keep trading without moving the price.
What to ask when you see a claim
- Is the figure before or after fees, spread and slippage?
- Is it from live trading with real money, or from a backtest or a paper account?
- For how many months, and how many trades? The trades needed calculator shows how long a record must be to mean anything.
- Who checked it, and can you see the account?
Our own page on what the public record of AI trading bots shows applies these questions to published claims.