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well, from purely mathematical standpoint, this is incorrect. optimum risk (measured as % of portfolio) is a function of expectancy (probability distribution of trade outcomes, to be more precise). therefore - as others have pointed out - unless you have a reason to believe that your...

this is called "shorting against the box" and was made illegal because it effectively allows you to circumvent the uptick rule. (yes, i know, so do bullets -- why they haven't been made illegal beats me...) note that it would even be illegal to have some of your relatives to hedge your long...

i second that. our experience shows that each introduced variable comes at a cost. throwing a large number of variables at a program just makes it "see ghosts": more and more random patterns will be interpreted as "real". well, that depends on your definition of "learning". while i can say...

well, in our case that would be a transatlantic line. last time i checked the prices for these were nothing short of astronomic. of course we could set up a machine in the u.s. as a proxy, but that would be just a silly workaround, and not worth the hassle (we're not _that_ unhappy with datek)...

datek, but we'll probably switch once a decent broker starts to offer a CTCI (without the silly leased line requirement a la IB). - jaan

we use a custom piece of software that we have programmed ourselves. the only "retail" systems i'm aware of are tradestation and metastock -- don't know if they're any good though. - jaan

no, we trade nasdaq. a significant advantage of the system is that it can continuously monitor thousands of stocks, and instantly react when profitable setups form in any one of these. can you elaborate? while i agree that small traders usually cannot afford custom programs, i don't see why...

i belong to a group that does fully automated trading, and - at least for us - second guessing is not a problem at all. think of it this way: an automated system is like an expert trader with an excellent track record. you usually don't second-guess an expert, especially when all his...

as tntneo already pointed out, nobody should be after 100% accurate signal. instead, positive expectancy is what we should be after. also, re slippage: it is really trivial to account for in a simulation. again, remember, the simulation does not have to calculate the exact slippage for each...

i use a 100% mechanical system, where i have a custom piece of software for both backtesting and trading. i'm not going to argue whether it is superior to discretionary trading or not, but one very important thing to note is that having a computer trade for me takes away 90% of the stress and...

first, thanks, hitman & others for a great thread! this i don't understand -- are you saying it is illegal to go long XYZ if you believe the company is going to be aquired in the near future? to me it seems so absurd that i think i'm missing something here. could you elaborate on this...