John - Your statement, and thus your conclusion, assumes that the sole purpose of C2 is to cater system vendor track-records to hedge funds.
While it may be true that hedge funds never asked for your “Hold and Hope” ratio (and granted, they may have never heard of it) and that their analytical focus is on existing statistical indicators, there’s a high probability that your average C2 subscriber may be very interested in this “Hold and Hope” ratio. In fact, I’m willing to argue that many subscribers might be more interested in this ratio than in the typical statistical indicators that hedge funds would use to measure the performance of a trading system.
Many subscribers simply do not understand the models employed by the various C2 vendors. Lack of vendor candor, and to a greater extent, lack of explanation of prorietary methods leads to same. As a result, non-technical subscribers would be well served with a measure of a vendor’s tendency to be careless with his risk management in an effort to wait out the market. I dare to say that most subscribers would rather know this in advance than after they’ve invested and find themselves in a draw-down situation or stopped out due to same.
Why can’t there be both the “traditional performance indicators” as well as the “for the average masses” indicators? Surely someone as astute and erudite as yourself could simply ignore the other indicators, going by the ones you know to be “correct” - while the great unwashed such as myself could focus on the simpleton indicators which are most important to us.
I’m just painfully sorry I entered this conversation… I’m going to bow out now and focus on my work.
“The only systems that will look bad is those that incur high drawdown for their net profit. They should look bad. This is called risk.” - Ross
Amen! I trade only a few systems on C2, and those that I trade I filter on both entry and exit. For every one [round-trip] trade that those systems signal, I may end up generating two or three [round-trip] trades. In effect, I turn their draw-down into my profits and ride a longer [fragmented by my entry/exits] curve up with them to their target profit point. This controls my maximum draw-down while at the same time maximizing my profits. But your typical subscriber is unlikely to be able to do that (I use automation and custom programming for same).
Some of the systems I subscribe to I would not trade otherwise, because their normal draw-down (eg, risk) is more than I care to swallow. Manually setting a stop-loss for each vendor signal doesn’t help - some of the systems would be unprofitable with such an approach.
Systems that make you sweat at night while holding open positions that are deep in the red should be tagged as such. Many of these systems don’t even recommend an allocation strategy - a subscriber who invests $10K in one of those and foolishly plays two (2) ES contract may soon find himself owing his brokerage some money!
> John - Your statement, and thus your conclusion, assumes that the sole purpose of C2 is to cater system vendor track-records to hedge funds.
Indeed this attitude among vendors is well documented in this thread.
The bottom line is that if C2 helps subscribers thrive and survive (most) everyone benefits. Pumping up lousy or mediocre systems is only a short term gain for a very few.
BTW, vendors may notice, the "most looked" at for the last several days
have mostly high HH rankings. And this was before HH existed. Potential subscribers DO understand this stat, if on an intuitive level. (Of course there are exceptions pertaining to looks most likely stemming from this thread).
Yes, and one vendor was posting to the effect that per trade drawdowns are really not that important, as long as his profits are reached.
I think some traders get their understanding from Ken Roberts and other commodities quacks… "Hey!!! Lets trade 1-2-3 tops!!!" "Hey - since 80% of options expire worthless, make money SELLING options!!!" "Typcially, heating oil futures are lower in the fall and climb in the winter, giving you the opportunity to turn $500 into $5000, $10,000, even $20,000 in profits!!! sheesh
I remain amazed at the concept that per-trade drawdowns are not considered that important (after all, this is not the same as SYSTEM drawdown!!!)
Any chimpanzee can just blindly load up on different equities, hang on until they turn profitable, and have a nice equity curve. And then the mid-Mays hit, when 5 months equity curve can in one week, look like Wile E. Coyote falling off the cliff.
There are no free lunches…
> I would say it is quite possible that I have followed, analyzed, subscribed to, dissected, more live trading systems than anyone in history (for their own trading). I said previously, 1200 or so, but 3000 systems is possible.
Ross,
I’ve written and tested over a 1000 systems in TS4 alone. Looked at and tested 1000’s more. There are 1000’s of guys like me or worse on the Omega list. I doubt your statement is even close to true.
“Hey - since 80% of options expire worthless, make money SELLING options!!!” - Ross quoting a quack
Too bad John Stossell didn’t cover some of these investment fables in his book Myths, Lies, and Downright Stupidity: Get Out the Shovel–Why Everything You Know is Wrong. It’s knowing the truth about general statements like this that would save consumers (and new investors) money.
I buy and sell [short] options every month… and I’m hoping they’ll expire worthless so I can make money! Not to mention all the options that are used for hedging, and are supposed to expire worthless also.
Pity the layman. Pity me, too.
Random number generators do not count as “systems” - therefore, I think your count is inflated.
(That’s my Friday humor quip… do not take offense)
there is a humongous difference between running automated tests on self-written, TS plugins or Black Box systems and hand testing newsletters and website signal providers from other providers that are often cloaked in a web of mystery/deceit.
It involves reading everything available, assessing the integrity of the statements, pushing for track records, sending questions to the provider and trying to get straight answers, getting free trials, seeing through a set of "example trades" as opposed to even a basic track record, learning to ignore "testimonials" (after all, what vendor posts the comments from UNhappy customers?), trying to sneak questions into the system forum or doing PMs to see what THEY think, sometimes paying just to get a week/month when there are no free trials and it looks promising, searching the web for any scraps or mentions of the system in worldwide forums (like misc.invest.futures or many others), building your own track record one email or daily "delayed" signal at a time until you get a sufficient number to get a feel for it, etc… Some systems can take over 20 hours worth of sleuthing just to put together a realistic picture of its value…
Some systems can take over 20 hours worth of sleuthing just to put together a realistic picture of its value…
Geez Ross, I guess I’m wrong. 3000 systems x 20+ hours =
60,000 hours. WOW! Like a 40 hour a week job for 30+ years.
No wonder you drink coffee. When do you have time for your
day job? No sex, drugs, and rock and roll for you.
I’m sorry to hear that’s how you choose to address my intellectually stimulating response. I gather there will be no social discourse between us, then.
Some systems can take over 20 hours worth of sleuthing. Obviously some take a lot less. Depends on how interesting it seems and how obscure the vendor is with the descriptions. When they provide a track record, it is relatively easy. When they are not even consistent with themselves, it is easy…
