£30k - £60k – leave the rat race.

As promised in my very first post, I am going to expand on my goals and provide brief explanations of how spread betting works for those who don’t know much about it. I am also going to expand on my rules in subsequent posts.

But firstly, this post – my goals.

What do I expect to do with my £30k investment?

When do I know if I have succeeded or not?

What do I base my success against?

The risk free rate? Average return of the FTSE over the last year, 2 years, 10 years?

The risk free rate is fairly low at the moment.

The return of the FTSE All Share Index is 7.48% for this year so far according to Google.

I think that is a good place to start. If I can beat the All Share Index then I am doing ok. If not, I might as well put my money into an index tracking fund and not bother with this highly risky and stressful spread betting business, right?

So, is achieving more than 7.48% over the next year good?

That wouldn’t be too bad but as I am highly geared to the tune of about 7% (details to follow); I feel that I should be achieving 7 times what the All Share Index returns at least. That means I need to return 52.36% in a year.

On my initial investment of £30k I would need to see gains of £15, 708.

Now that’s pretty good – more than half my money-at-risk returned.

I think I can do better. You would think, and correctly so at the moment, that that is a very brazen statement considering my performance so far but what the hell, I’m going to back myself !

I think I can return double the initial investment in a year. That is £30k over the following year. Outperforming the FTSE All Share Index by a whopping 13 times !

A big ask I know, but I am (as I have said before) an eternal optimist.

Let’s see what happens.

£30k - £60k – leave the rat race.