Thanks everyone for your answers. I think sam_w’s point is a good one. Even if the strategy is 500% TOS, it is possible that the developer has a 1million$ account and then his risk is lower than that of someone with an 100k$ account at 100% scaling. We cannot know that. However it is also fair to say that the developer says in the description “have contingency funds available in case we need to go to 8 contracts, otherwise scale it at 50%”.
A developer can be TOS and follow all signals but have private offsetting positions that make their exposure to their system zero. I’d hope nobody would do that, but it’s easy to do.
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I hope not, that would be sneaky. A second account to hedge their system?
Does that mean we can no longer trust a TOS system as much as we are supposed to?
I THink the point is that TOS can never be considered a silver bullet. I think TOS should only be seen as an indicator that the publisher has some money in the game. Not that their whole investment plan is tied up in it. I mean I still put money in my 401k etc. so no matter what TOS is only going to show part of my investments.
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I expect most TOS systems are TOS as they claim. However everyone should know that developers can hedge as they wish which could include hedging against their own system.
I have thought about this, setting up my own sub-account to hedge as a way to manage some risk when the developer has a different idea of risk then I do. Just never found a way to set it up so it could do it on its own with me going in and manually doing the hedge
David and Charles you both make good points to thank about. thanks for sharing.
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