[virgilp]

Thousands of percents, right? If your 5% successes do not return at least 20x, you're globally in the red.

[pedrosorio]

7% is the usual figure quoted for annualized stock market returns, so I guess that’s what they mean: xyz% annualized.

[nothrabannosir]

Parent was referring to the “hundreds” part, not the 7. If 5% of your bets win, but only pay off in the hundreds %, you’re going bankrupt. You need at least 2000% return, amortised over the winners, to break even. More to beat that 7%.

[vidarh]

Yes, but the point being that 7% is an annualized number; if the hundreds of percent is also referring to annualized returns, then it makes sense.