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There is a substantial risk of loss in trading. You should therefore carefully consider
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We still have several slots open for tomorrow’s webinar introducing the C2Star Certification program.
The webinar is on Thursday, January 17, at 4:30 PM Eastern USA time.
If you are a strategy developer here on C2, you will be interested in learning about C2Star Certification. If your strategy can achieve performance while complying with strict risk controls, your strategy will receive several benefits, including favorable economics and guaranteed subscription revenue.
Attendees to the webinar will also receive a 75% discount on the cost of participating in the program.
Space is limited, because I’m too cheap to pay GotoWebinar Corporation for a top-of-the-line license that allows us to host lots of webinar participants. So hurry.
The max open-loss of $2k (about 4% loss) seems very tight. Moreover, if triggered it would throw the system out as I understand it, then we rinse/repeat, pay another $199 to restart and wait 60 days… that is a problem, as a 4% loss is highly probably even with the best intentions.
With overnight positions on most equity strats (even hedged strats like the ones I am running), this 4% is most likely to trigger even the most prudent strategies at some point during a 6-12 month period - it is just the law of averages.
Can I ask - how did you come up with this number of 4%? There is the cynic in me (probably completely wrong) which wants to believe the c2Star program was probably designed more as a revenue stream for c2 where wannabe stars will just keep resetting and paying this fee for the opportunity. Cynical I know!
The optimist in me likes the direction c2 is going, to make strategies more risk-conscious and appealing to a wider audience.
I think another look at the throw-out rules, eg., 4% open-loss rule needs a second look at this beta stage - the following are suggestions…
Maximum Open Loss as percent of equity: 7.5%
Maximum Open Loss: ($3,750)
Maximum Equity Drawdown: (7.5%) rolling 24 hours
Maximum Equity Drawdown: ($3,750) rolling 24 hours
Maximum Equity Drawdown: ($5,000) All Time - No changes to this last rule.
The c2Star program is too restrictive to be based on reality in trading, as most systems will be thrown out, even the most astute ones, at 4% and 5% d/d
good to see some discussion on this. I dint really look at the risk criteria in detail. I am pretty sure I can not even meet the minimum performance criteria over a long period of time (i.e. strategy being positive in ANY 60 day period AND outperform S&P 500 by 1% ) If the minimum performance criteria is taken out, probably i can achieve any risk parameters set for a decent time
Noone else thinks minimum performance criteria is impossible to achieve over a long period?
Would be curious what is the longest period any system on C2 from past and present which could stick to the c2star requirements…
I dont want to sound negative - I like the general direction of providing quality to systems. But…
the minimum performance criteria will make trade leaders behave erratically to meet the performance criteria - which in fact will have a negative impact. Controlling risk is one thing and indeed is in the hands of the trade leader - but putting pressure on trade leaders to realize very difficult performance criteria will have exactly the opposite effect for subscribers.
Seems like I am on the other side of this discussion.
I really like this program and idea.
Been really tired of all those supreme traders who make 100 % each month, then add up to 20 or 50 YM or ES contracts on losing trade.
Agree that this is very hard to achieve with futures, one must either scalp or trade things like corn in order not to break DD rules.
It is more doable with stocks.
Again, I like that C2 is opening new directions. Who knows, maybe this is only first one?
Why not make an aggressive program for investors who seek higher returns and are willing to tolerate bigger DD?
Maybe I am misunderstanding but to me it seems like the following could and likely will happen.
If a strategy bought SPY with 100% of the account and held it long term they would never get the C2Star because they are going to have drawdowns that are outside the limits.
If a strategy gets a lucky series of trades using S&P 500 futures using leverage well in excess of 10 plus times they can achieve the C2Star.
If both of these are true it seems like the system needs some work. C2 should be looking at prevent unreasonable trading using limitations on the trader not just some screening criteria. C2 should look at creating star systems that adhere to different levels of conservative limitations, such as no margin or limited margin use, minimum diversification percentages, passing a stress test threshold every day like IB’s stress test. Many of the systems that have crashed and burned in the past had wonderful equity curves that would pass C2Star. However, I know of no system that has crashed and burned that used no margin etc. Based on the current criteria the C2Star system doesn’t make me trust C2Star systems any more than others.
If there were limits that said this leader can put no more than this % in any single position or that the leader can’t exceed this amount of margin used, or this leader can’t have a stress test pass X threshold that would make me feel much more comfortable investing with another leader than telling me that their previous performance only had a small drawdown. That is stuff we can already deduce ourselves from the charts and trade data. What we can’t do is guarantee that the trader won’t act differently or too aggressive in the future.
My opinion is that no one will be able to satisfy all of the criteria for a sustained period of time and C2 will be making a lot of money on everyone continually resetting their strategies for more and more fees.
I personally have no issue with the maximum draw down requirements. My issue is with the rolling 60 day period for the profit criteria. There is very little possibility to beat the S&P 500 by 1% every 60 day rolling period with the additional requirement that you be profitable for every 60 day rolling period as well. This is because once you pass the initial 60 day period, the requirement changes every single day, since it is a rolling 60 day period.
A fairer profitability requirement would be to start everyone at the nearest 1st of the month following initial signup and then applying the 1% above S&P 500 period on a 2 month basis. That way, it’s not a rolling period and you can see exactly what you earned each 60 day period from the performance chart. As proposed, each trade leader would have to calculate a new criteria to beat every single day instead of once per month.
So for example, if I started on 1/10/19, the profitability criteria would start on 2/1/19 and continue through 3/31/19. During that time, I would have to be profitable and beat the S&P 500 index by at least 1%. If I manage to do that, a new calculation would start on 4/1/19 and continue through 5/31/19. The draw down criteria can continue as originally proposed.
Its not just about drawdown. In this case it is easy to say the strategy wont be a c2star because there is no way your strategy will outperform spy by 1% on any 60 day period
Not so easy given the stringent risk criteria. Which is the good thing about risk control. Luck will run out pretty fast. Also u dont have to leverage so much as performance criteria is to beat sp500 by ‘only’ 1 percent on any 60 day period - but if they are not able to get to minimum perf criteria with usual trades, they might go for higher leverage just to make up the numbers for the 60 day
I seriously doubt that. In fact i would be surprisesd if there exists/existed any strategy that lasted only the minimum performance critiera for say 6 months without even any risk parameters. Any volunteers to write the query on c2 database to find out?
My suggestion :
-give thought to min. Performance criteria. In my opinion any unrealistic minimum performance criteria will negatively affect subscribers. Risk management criteria works towards protecting subscribers. Minimum performance criteria will bring additional risk for subscribers
-add position sizing constraints to risk controlling criteria. This will stop trade leaders’ erratic behaviour to a large extent and also reduce the luck factor
The idea is good. But conditions are not realistic to comply with. I trade currency futures. 1 lot is 62 500, 100 000, 125 000 - depends on the currency. The score is 50 000. It’s not realistic to comply with the risk conditions
To make my point about minimum performance criteria consider
Or
(Am sure i can find more )
Great stat. One of the better managed systems here in my opinion. You can see how many times the strategies will get reset considering only minimum peroformance criteria - let alone risk management critetia
Same applies to older stable systems like
Bottomline its impossible to provide positive returns everyday compared to 60 days before and that too by outperforming sp500 by 1 percent.
A very basic Example why c2star will not help subscribers when minimum performance criteria is included.
Day 1 - strategy is live with 50,000. Day 60 - strategy is down 48000 - ( or whatever the lowest amount permissible after adhering to risk management over the last 60 days). Trade leader has no trades to take on day 61 as per his system. But he has to achieve the minimum performance criteria. for simplicity lets assume sp500 was negative and returned < 1% during the period so that minimum performance becomes that strategy needs to be ‘just’ positve over the last 60 days. If not meeting minimum performance critiera, Trade leader is bound to lose his certification fee, subscription fees and additional guarenteed C2 income. He HAS to react! he conjures a trade in an attempt make the equity 50,001 for the day! Rather than sticking to his system, the trade leader is left to think what should he do ‘today’ so that he can keep all his income from C2 in tact.! Does it really help subscribers? I am afraid it is the opposite as the pressure to perform by trade leader given that he has nothing to lose will lead to crazy trades that will affect subscribers.
Not sure if this point of view was considered in the design on c2star requirements.
My take is that Risk management criteria works towards protecting subscribers. Minimum performance criteria will bring additional risk for subscribers - comments?
I second this idea. I prefer set limits on the rules of trading like a stress test, rather than set parameters like ‘5% d/d in 24 hrs and you are out’. That kind of ‘throw out, re-churn, reset and pay us $200 for the privilage’ wreaks of c2 trying again to profit from wannabe’s. I may be wrong, but c2Star imo has a lot more to do to convince some of the more intelligent/experienced on this forum.
Practically, the parameters they are setting are nigh-impossible to maintain - the law of averages will kill it, and hey-presto the tills go kerching for another $199 for c2. Damn, I thought it was a good idea to start, until I started looking more deeply into this.
