Yes Ac3 I know that it's a standard disclaimer. Everyone uses them for protection and legal sakes. But, I just used it because it states my thoughts exactly of the site and methods..........
Are these Systems really that good?
- Thread starter MISSSNP
- Start date
Good systems can become bad systems when everybody uses it.
Agreed 100% ... as someone who prefers systematic trading I have spent some time putting together various systems and when I find one that works w regularity I would b hard pressed to allow anyone to look at the details of it ... if you have something that works and u allow other people to trade off of it and they are astute mrkt technicians then you are just giving them the results and asking them to figure out the inputs (which they will over time). If these guys have found the holy grail .....bless them ... if not be wary
I think some of the above posts are missing the point about systems in general. Let's look at the common question, why would you ever sell a good system? I think there are reasonable answers. First, I don't think it is unimaginable that someone would rather develop systmes than trade. Maybe they are not comfortable with the risks or don't have the capital their system requires. More likely, there is nothing truly extraordinary in their system, so why not sell it. For example, I can put together a vol breakout system that will test ok, particularly since I have the benefit of hindsight in not only selecting parameters but also themarkets I will test it on. Most likely, such a system will work in the future, but there's nothing very proprietary there.
Where I would have a problem is in trading someone's blackbox system. If you don't know why a system is generating signals, it becomes very hard to take them. Also, you have no guarantee the system is anything but curve-fitted nonsense. A decent system should bear a logical relationship to observable market action. If it doesn't, that is a red flag that it is curve-fitted.
Where I would have a problem is in trading someone's blackbox system. If you don't know why a system is generating signals, it becomes very hard to take them. Also, you have no guarantee the system is anything but curve-fitted nonsense. A decent system should bear a logical relationship to observable market action. If it doesn't, that is a red flag that it is curve-fitted.
If anyone is interested I found this peice in this weeks Barrons magazine quite unsettling in regard to system trades ....
A more recent development than traditional program trading is algorithmic trading. Algorithms are statistical formulas embedded in computer programs used to find the most opportune time and price at which to trade a given stock or stocks. The programs are crammed with data on each stock's price and volume tendencies, and the algorithms determine the best way to approach a trade. Most large investment houses -- Goldman Sachs, Credit Suisse First Boston, Morgan Stanley and J.P. Morgan among others -- have developed these programs for their own use and for their institutional clients.
In their most basic form, the programs act as a "smart trader," allowing an investor to execute trades cheaply and with minimal market disruption. If a fund manager wants to buy, say, 300,000 shares of Cisco Systems, the algorithm might figure out how to piece orders into the market over the course of a day to buy them most efficiently.
A more recent development than traditional program trading is algorithmic trading. Algorithms are statistical formulas embedded in computer programs used to find the most opportune time and price at which to trade a given stock or stocks. The programs are crammed with data on each stock's price and volume tendencies, and the algorithms determine the best way to approach a trade. Most large investment houses -- Goldman Sachs, Credit Suisse First Boston, Morgan Stanley and J.P. Morgan among others -- have developed these programs for their own use and for their institutional clients.
In their most basic form, the programs act as a "smart trader," allowing an investor to execute trades cheaply and with minimal market disruption. If a fund manager wants to buy, say, 300,000 shares of Cisco Systems, the algorithm might figure out how to piece orders into the market over the course of a day to buy them most efficiently.
Spot on....
What most here seem to forget is trading is a business. Why would Tradestation make software for easy system development when the vast majority of traders have no knowledge in real programming? Why does GM make cars that go fast? Why does Anheiser-Busch make Budweiser?
The answer: there is demand for it. Selling a system for $1000 is risk free (assuming you're following regulations), but trading the system has vitrually unlimited risk.
If it's not new knowledge and it's a good system, you can sell it pretty easily. Especially if you're trading something better, why wouldn't you sell it. It's not your best system and it's not new knowledge, so what's so wrong with selling it?
Think about all the money to be made releasing "systems" through books, seminars, and software. Many of them don't work, but a lot of them did at one point, and a good portion still work.
With regards to this vendor, I would say take a look at the numbers, the timeframe and length, and procedures of the testing, and the in- and out-of-sample results. Any vendor who refuses this information shouldn't be trusted. Try checking out the company for any past CFTC violations regarding fraud. In short, do the homework.
People do sell good systems. Aberration has been profitable for many years and continues to be.
Think about all the money to be made releasing "systems" through books, seminars, and software. Many of them don't work, but a lot of them did at one point, and a good portion still work.
With regards to this vendor, I would say take a look at the numbers, the timeframe and length, and procedures of the testing, and the in- and out-of-sample results. Any vendor who refuses this information shouldn't be trusted. Try checking out the company for any past CFTC violations regarding fraud. In short, do the homework.
People do sell good systems. Aberration has been profitable for many years and continues to be.