I agree systematic trading is possible, but the ones made public probably don't work. Look at the systems published on this site http://traderclub.com/, they are all great in back testing, but in walk forward simulation some actually have losing years. (I won't even allow a losing month if I were to use a system).
Intraday Indicators
- Thread starter saschabr
- Start date
For an independant evaluation of systems for futures look there :
http://www.futurestruth.com/topten.htm
Some of these systems are working for a while. But it can be misleading too. For instance the Onix system seems very good, it is number one. But actually since march it is constantly trading against the Nasdaq with big losses. At least the vendor is really honest and provides full disclosure of trades. [to be fair, it offers other systems with good forward performance].
For stocks, system trading is more difficult imo. I think system trading should scan the entire market [with your choice of prices and minimum volume per stock of course]. Unlike system trading for futures which usually tracks one market and trade it to death [and to profits hopefully].
From my experience, it is more challenging to develop such a system [for stocks], but of course it is possible and profitable. I have a couple systems like this, they work also in walk forward and are profitable. These ones are traded in a hedge fund for customers. Therefore, you are right, they are not public and available as systems.
The big(ger) money is in system trading index futures. And I love system daytrading them.
I don't consider myself a good trader, and I admire traders who can themselves daytrade stocks for big profits day in day out [without a mechanical system].
On the other hand, I can build good mechanical systems for my firm and for my own trading. I may be a bad discretionary trader, but I think I am a rather good robot who can follow the systems I build. My psychology is under control too [without it, system or discretionary traders are doomed].
Sorry I insisted in this thread. But I feel there is a myth that system trader don't make money and systems don't work. That's silly. It reminds me the saying "I never met a rich technical analyst". That's bs.
The myth is supported by the long list of scams and stupid systems ads make-a-million-in-two weeks bs.
Let me remind everyone : if you are a trader and you make money for a while, odds are you are a system trader. ie you have a systematic approach and you always [or 80% of the time let's say] do the same things which work for you.
The only difference I see with, so called, system trading is the mechanical aspect : the rules are encoded in a software. But basically it is a way to model what works and make it always the systematic [hey! you can code the exceptions to the rules in your system too, you know..].
I think I made my point. I hope at least, because if newbies would understand the implication it would save them a lot of pain. Main implications are : you have to be systematic, you need to monitor what you do, you want to have risk management and the holy grail is you and your psychology.
But like you said, I have nothing to sell to you. Usually good systems are not for sale. That, we agree.
vpiNeo
http://www.futurestruth.com/topten.htm
Some of these systems are working for a while. But it can be misleading too. For instance the Onix system seems very good, it is number one. But actually since march it is constantly trading against the Nasdaq with big losses. At least the vendor is really honest and provides full disclosure of trades. [to be fair, it offers other systems with good forward performance].
For stocks, system trading is more difficult imo. I think system trading should scan the entire market [with your choice of prices and minimum volume per stock of course]. Unlike system trading for futures which usually tracks one market and trade it to death [and to profits hopefully].
From my experience, it is more challenging to develop such a system [for stocks], but of course it is possible and profitable. I have a couple systems like this, they work also in walk forward and are profitable. These ones are traded in a hedge fund for customers. Therefore, you are right, they are not public and available as systems.
The big(ger) money is in system trading index futures. And I love system daytrading them.
I don't consider myself a good trader, and I admire traders who can themselves daytrade stocks for big profits day in day out [without a mechanical system].
On the other hand, I can build good mechanical systems for my firm and for my own trading. I may be a bad discretionary trader, but I think I am a rather good robot who can follow the systems I build. My psychology is under control too [without it, system or discretionary traders are doomed].
Sorry I insisted in this thread. But I feel there is a myth that system trader don't make money and systems don't work. That's silly. It reminds me the saying "I never met a rich technical analyst". That's bs.
The myth is supported by the long list of scams and stupid systems ads make-a-million-in-two weeks bs.
Let me remind everyone : if you are a trader and you make money for a while, odds are you are a system trader. ie you have a systematic approach and you always [or 80% of the time let's say] do the same things which work for you.
The only difference I see with, so called, system trading is the mechanical aspect : the rules are encoded in a software. But basically it is a way to model what works and make it always the systematic [hey! you can code the exceptions to the rules in your system too, you know..].
I think I made my point. I hope at least, because if newbies would understand the implication it would save them a lot of pain. Main implications are : you have to be systematic, you need to monitor what you do, you want to have risk management and the holy grail is you and your psychology.
But like you said, I have nothing to sell to you. Usually good systems are not for sale. That, we agree.
vpiNeo
An analogy to the real world:
College professors have enough knowledge to be millionaires.
Why are they teaching?
Answer: They don't know how to specialize, and apply, their knowledge to the real world.
Its funny how when I started attending seminars, I believed like many, that the speakers had made their killing, and were teaching for fun. lol I believed that others knew me, and what I needed, to make me successful. Now, I merely listen to others opinions.
I didn't start winning trades until understanding human behavior. Observing others(all society).
We are human when we make decisions. I learned in marketing that it is human that we first make our initial decisions on an emotional level. Then we back up that decision with logic, hopefully before purchase, or "buyer remorse" sets in. This is what marketing executives understand. Salespeople are trained not to take no for an answer, and all marketing is geared toward getting an emotional buying decision. They would be out of business if they relied on the truth, and pure reason and logic.
For example, you go buy a product. The decision making process is impulsive, though; we may have had that item on our minds from a practical want, or necessity. We then support, or justify, that emotional decision with logical practicality. If that decision is not justified soon we end up returning that product.
In the stock market, one cannot think this way making emotional decisions, because there is no second chance, or returns allowed. Yet just as with a product, our minds trick us by justifying why we purchased that product, or how we can use it, or even give it away so that it is useful.
It is common for a bad-trading decision to be justified as a learning experience as if we had to go through with it sometime, as everyone does. Or, (Ok, now Iâll turn this trade into and investment, or Ok, Iâll sell calls, etc.) Well, that is wrong thinking, yet the truth is that many need to hit rock bottom as an alcoholic needs to hit rock bottom before accepting that they have a problem.(psychological) .
In trading, you canât identify your psychological problems until you have a system, and know its rules like the back of your hand. In addition, as tntneo pointed out, steer away from anyone who has something for sale.
So, in conclusion, Intra-day indicators/Trading Systems, are used in different combinations to fit macro probabilities versus an individual trader who uses, with skill, the totality of the current market conditions to use more micro probabilities. Only the individual knows what works for them. A software developer has approached me to create a software system for the trades that I have been calling to him. He and his partner understand that this is not for the public.
P.S. Whiners and losers are permeating ET. I hope this thread supports a policy to identify, and ban them from this site, along with continued banning of posts directed at selling.
Jeffrey
I agree, the exchange of ideas,education, and over all help should be the focus. Advances are made sometimes by two or more people each having part of an overall plan, that once put together acts as a whole. My interest in this site is to learn from those who are successful, not to get an indirect sales pitch.
Well, its not often that I put my 2 cents in, but you all have caught my interest and I will share what my experience has given me with daytrading. Unlike many traders, I spen almost the entire day watching the stocks - I may not trade much during the middle hours, but I find them very revealing about a stock's cycles. My personal ecperience is that many stocks have common recurring rythms of sorts. Some have less identifyable ones, and I also find that volume plays a key role - ie the highly played ones on a given day (relatively higher volume than usual) will tend to have nice swings that are easier to get into and get out of. For example, I jumped into Tivo on friday the 25th, as the swings were just beautiful for a while, and just using market orders was able to make about $400 in under 10 minutes.
Stocks like AMZN and ORCL and SUNW very often have days when their rythms are almost predictable. I find that following the tape quite closely and attentively allows for high odds of success. As far as charts are concerned, I am not a huge user, as the time it take to get them and analyze them often results in missed opportunities.
Here's my point: there are always tons (and I mean tons) of stocks that are on the move, swinging fast and far...I am a person who figures that if it doesn't look great, then there is probably somewhere else to looks. If you "wait for the money to come to you", and keep your eyes peeled, you can have a much higher percent of successful trades than not...and by the way, easily clear several hundred a day (after comissions). Yes, you can do well, and the beautiful days are always a treat...I played IBEM last week, got in at 0.68 before the explosion...sold at 1.47 - half, just to double my money...I'm not bragging, just saying that there is undoubtedly lots of money to be made by people who control losses and let winners ride her....OK enough rant. Just my opinion.
Stocks like AMZN and ORCL and SUNW very often have days when their rythms are almost predictable. I find that following the tape quite closely and attentively allows for high odds of success. As far as charts are concerned, I am not a huge user, as the time it take to get them and analyze them often results in missed opportunities.
Here's my point: there are always tons (and I mean tons) of stocks that are on the move, swinging fast and far...I am a person who figures that if it doesn't look great, then there is probably somewhere else to looks. If you "wait for the money to come to you", and keep your eyes peeled, you can have a much higher percent of successful trades than not...and by the way, easily clear several hundred a day (after comissions). Yes, you can do well, and the beautiful days are always a treat...I played IBEM last week, got in at 0.68 before the explosion...sold at 1.47 - half, just to double my money...I'm not bragging, just saying that there is undoubtedly lots of money to be made by people who control losses and let winners ride her....OK enough rant. Just my opinion.