Machine designed strategies. Do they work?

v75z52 · Mar 20, 2012

I have looked at Trading System lab but they do not provide a demo. Some serious hype on the website but this is what a user of this program recently said:

"TSL doesn't work. Tried it personally. Was not able to develop a single working strategy."

A user of Adaptrade claims that "Strategies quickly fade"

Another user of Adaptrade claims that "strategy does not perform (equity curve goes down) with new data beyond the out of sample period."

Now it may be the case that these individuals failed to use the programs properly. What do you think?

Occam · Mar 20, 2012

I think that no economically rational agent would ever sell purely automated trading software that really works. So anything that's sold as such is all but guaranteed to fail, unless you're adding some serious value yourself (e.g., by extending the code or doing something discretionary in addition to the signal given by the software).

Humpy · Mar 20, 2012

If anyone is so useless that they need hand holding then I can suggest collective 2 and zulu are worth considering.

Craig66 · Mar 20, 2012

Quote from Occam:
I think that no economically rational agent would ever sell purely automated trading software that really works.

The one and only correct answer to this question.

goodgoing · Mar 21, 2012

Quote from v75z52:

Now it may be the case that these individuals failed to use the programs properly. What do you think?

You have to understand that no software will make you rich unless you put in substantial time and effort. Most of these programs facilitate trading system development but users must have experience and willing to work hard. I use Price Action Lab but only as a tool to analyze price series for patterns. I do not expect it or any other program to offer me a final solution. That is not rational thinking and as Occam said no rational person would ever sell such program even if it existed.

jcl · Mar 21, 2012

Quote from v75z52:

I have looked at Trading System lab but they do not provide a demo. Some serious hype on the website but this is what a user of this program recently said:

Some machine designed strategies might work, others don't - this just depends on the algorithms and their implementation. As long as you don't know them, the only real way to find out is listening to people who are using that software. Comments by others who don't know that software might be well meant, but are useless for a purchase decision.

The fact that Trading System lab don't provide a demo, and their price policy might give a hint, though.

trade4ever2day · Mar 23, 2012

Quote from jcl:

Some machine designed strategies might work, others don't - this just depends on the algorithms and their implementation. As long as you don't know them, the only real way to find out is listening to people who are using that software. Comments by others who don't know that software might be well meant, but are useless for a purchase decision.

The fact that Trading System lab don't provide a demo, and their price policy might give a hint, though.

Good points. Have you used any such program jcl?

Rationalize · Mar 24, 2012

Quote from jcl:

Yes, I use such a program - it's in fact rather simple. Zorro generates profitable trade algorithms with a decision tree and with a perceptron. However the profitability highly depends on the selection of input values to the AI function. So you still need to develop the strategy yourself, although the final C code is generated automatically.

But I can absolutely imagine that someone writes a software that generates trade algorithms really on its own, maybe based on some general settings by the user. This is not trivial, but certainly doable.

The other question is if TSL is really doing this and if its strategies really work. With no demo, and some suspicious statements on their website, there is reasonable doubt. Some high priced trade tools are not far from scam.

Rational agent "jcl" is marketing a system / platform called Zorro

jcl · Mar 24, 2012

Quote from Rationalize:

Rational agent "jcl" is marketing a system / platform called Zorro

Seems you heard something, but got it wrong: I'm programming Zorro, not marketing it. Programming is when you write a program. Marketing is when you sell a program for money.

Rationalize · Mar 24, 2012

Quote from jcl:

Seems you heard something, but got it wrong: I'm programming Zorro, not marketing it. Programming is when you write a program. Marketing is when you sell a program for money.

Give it a name, talk about it on the internet, that's marketing.

Perhaps you could think about buying a sponsorship here.