If you asked me to turn $100 into $200 trading stock/options I feel I could easily do it. But why can’t I turn $1M to $2M as easily? Or $5M to $10M? You can only trade that much volume on a liquid stock. Options? Forget about it. Im getting greedy. Time to sell.
this is why folks like druckenmiller just focus on the big fat pitches, they dont get caught up into the random shitcoins. They look at the big picture of the world and ask "what do i think the rich people of the world will be investing in the near future" and then they hold those bets for a few months to a few years what do proles do: shitcoin go brr on 5 minute chart hurr durr me smort me 2x $100 what you end up finding is the overwhelming.majority of rich people realize "wait a minute, lemme just invest in my own companies and build them up great" meanwhile proles think "hurr durr me smort me get rsu peanuts"
It’s risk mgt and emotions. You lose 50% on that one $100 option trade, it sux, but ain’t that big of a deal losing $50. You do that on a $1m investment (assuming that’s a big chunk of your NW), it hurts real real bad. As my folio increased, I am doing less and less long options as a percentage of my overall portfolio- reducing my risks.
Risk doesn’t scale linearly like that.