Is fully automated trading a fantasy? Your opinions here

Is a 100% automated system possible for a $10k (futures/forex)? To live off of?

  • Yes, you can print money in the markets (large, consistent short term gains).

    Votes: 106 37.9%

  • Yes, but not to live off of (very slow gains long term).

    Votes: 27 9.6%

  • It may be possible, but no one would sell it.

    Votes: 73 26.1%

  • No. Strictly a trader fantasy.

    Votes: 74 26.4%
  • Total voters
    280
<i>"Appears you program easylanguage Tradestation."</i>

Appearances are deceiving :>)

At first I worked with TS canned strategies, then had some custom-written source code ELDs developed. I am not fluent in easy language or any other programming.

Once I had my own ELD product, I was able to make any number of systems based on the same study but using different settings, initial stop loss and profit targets. That can create "sister" systems with a different outcome to run as a pair. One can also program the same custom logic in any market = symbol to create an unlimited number of systems.

So... that's the extent of my system's writing career. I can do a number of things with what I possess, but no ability or interest in writing further from there.

Hope this explanation helps clarify :)
 
Quote from austinp:

#2: Fully mechanical systems are possible, but not easy to find or construct. I wrote dozens of systems for FX markets using all manner of tech analysis tools. Oscillators like RSI, etc or moving averages absolutely will not hold up over time. Neither will anything too heavily tweaked or multiple-rules based.

Attached is an example, one of two "sister" GBPUSD systems results I wrote in mid-2004 that are walking forward untouched, no modifications since late 2004.

Factored in -$40 per trade on the bid/ask spread of -4pips slippage, no commission cost reflected. One full-size FX contract straight thru, no adding size or pyramiding.

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It just so happens that GBPUSD tests out best = most profitable in almost every example of systems I wrote. EURUSD and AUDUSD were next, but probably 30% less profitable. Anything related to Yen can be profitable overall, but the drawdown curves are usually gut-wrenching.

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There are numerous commercial systems for sale that hold up over the course of time... with periods of months to years sometimes unprofitable or b.e. at best.

I'm aware at least one fund manager who earns seven - eight figures annually with managed FX accounts using nothing but commercial-based systems purchased and run verbatim (or slightly tweaked at most) in basket portfolio fashion.
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austinp, FWIW, my partner and I have found exactly the same things to be true. GBPUSD often tests best for whatever reason, which is the reason we focus so heavily on it. Yen pairs are exactly as you described them at times.

Interestingly, most people tend to focus on finding "one system that 'prints money,'" but the true route to success is multiple systems trading multiple markets. This way the dead periods for certain systems can be overcome by gains in other systems and markets...
 
<i>"austinp, FWIW, my partner and I have found exactly the same things to be true. GBPUSD often tests best for whatever reason, which is the reason we focus so heavily on it. Yen pairs are exactly as you described them at times."</i>

GBP makes the widest relative price swings, while EUR tends to be choppier. Not a lot different than ER2 versus ES tendencies.

As for the yen crosses... they are jusy plain buzzy. One look at the wicks on their candles across any timeframe says it all. EURJPY and GBPJPY test out best in systems, but when they have a bad month or two it tends to be frightening.

Run together in a basket portfolio, they help smooth the curves out.

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If I were trading-investing a large sum of money, I'd expose some of it to basketed FX systems. That would also entail rock-solid conectivity from software to trading source, be it in-house with a brokerage ~ clearing firm or otherwise.
 
Quote from apex82:

The equity curve...
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That's a nice curve apex... my hat's off to you. I'm still working on developing a robust automated strategy myself. It seems whenever I get a system with an equity curve like yours, I inevitably find a bug in my code that brings me back down to earth. :eek:
 
Dude that's ridiculous. Telling us whether it makes 1 trade a day or 1 a week is not going to degrade its performance !!!!
 
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