You probably got into trading because you figured you could earn quick, easy money from anywhere. Maybe you entertained the notion of sitting on a tropical island beach somewhere. The waiter would bring you drinks with little umbrellas while you would casually trade stocks. You could fling hundreds of thousands (millions?) of dollars in trades around while connected to the world’s markets by only the invisible thread of the luxury hotel’s WiFi connection.

Hello? Earth to reader. Earth to reader. Come in please.

“Houston, we have a problem.” (Side note – this quote is a reference to the Apollo 13 accident in which the astronauts barely made it back alive.)

You see, when you reach for the moon, you’re taking some pretty heady risks. Sometimes, this only sets you up for things to go badly. BOOM. Crash and burn.

Let’s not go there, OK?

How much can you expect to earn in your trading? As I’ve just alluded to, the higher the risk, the higher the possibility of ruin.

What can you realistically expect? For starters, it’s instructive to see how well some of the best investors in the world do. Let’s name names and give yearly gains:

* 29% for 37 yrs. - George Soros

* 21% for 40 yrs. - Warren Buffett

* 29% for 18 yrs. - Eddie Lampert

* 29% for 18 yrs. - Peter Lynch

* 24% for 13 yrs. - Jim Cramer

* 15% for 20 yrs. - Benjamin Graham

Do you think you’ve got what it takes to do better than these guys, and if so why?

Now, consider Fred Hager, who, according to Hulbert Financial Digest, has a 30 year track record of returning 29% per year. As you know, Hulbert Financial Digest is the leading rating service for investment newsletter publishers.

Sure, you have an advantage because you don’t have to invest millions, or even billions of dollars. It’s hard to get superior returns at these levels because you tend to become the market. In other words, a little trader could do better than a large investor because he can be so much more nimble.

Let’s take a realistic example. Suppose you develop expertise in picking stocks for short term trades. You’ll have some winning trades, and alas, some losing ones. Do you think you can beat George Soros at 29%? Now, don’t get me wrong; even though this number is within your grasp, it’s not certain you’ll do as well. You could do worse, you could do better. Everyone is different.

I’m just trying to give you a little reality check so you don’t start out with unrealistic expectations. Unless you start out with realistic expectations, you’ll never know how good you can become. Perhaps, you’ll find you’re good enough to trade whenever and wherever you want. Then you can show Warren Buffet a thing or two about stock picking and give that windbag, Jim Cramer, something to aspire to.

Doug Newberry enjoys his position as the Editor of the "Market Toolbox Newsletter" and Host of the "Market Toolbox On Demand" online radio show. His company, The Investing Systems Network, has customers in more than 70 countries, and it helps investors learn how to trade stocks and manage their portfolios by providing specialized stock picking software tools.