I am going to start auto trading for the new year. Anyone want to share any tips and tricks? Also how did everyone do last year with the systems they followed?
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Happy new year! 
I would say make sure you scale properly with the trade leader. Also make sure your broker is good broker for that instrument type.
Good luck trading
Seems like most people are using IB so that is what I’m trying. I am scaling in increments of 100% 200% 300% since many of the futures systems trade in 1,2,3 contracts.
My experience with AutoTrading has not been that good. It works for most part but sometimes it makes really stupid mistakes like strategy closing a position entirely but auto trade only closed 87.5 % of that. Just today couple of trades from the strategy did not get sent to the broker at all ( i have sent C2 an email about it and still waiting to hear back from them ). C2’s recommendation has always been that you should enable “auto sync” on ( which means you can’t do manual trading in that acct ). I don’t want to do auto sync and hence my experience with Auto Trade has not been very good.
Also support from C2 is not as good as you would want it to be. They rarely pick up the phone ( which is what you need when you see that because of a mistake of auto trade you are loosing real dollars ) and emails don’t get answered within a day.
So, i would still recommend for you to use auto trade if you are following a high frequency trading system ( because you can’t follow the system manually - its just impossible ). However, please check your acct and the strategy atleast 2-3 times a day.
About the broker - i think IB is best when it comes to execution and really low prices.
Understanding Risk is so important. If you are looking at Futures (which I quit looking at), you really need to consider the risk. How many futures systems are more than 3 years old and are still profitable? Derivatives – everything but equities on C2 – are so much more risky than equities are. They can cause rapid loss of capital. The value of a contract can go to zero much more quickly than the value of a company that has assets, orders to fill, etc. Also, you should be aware that intraday drawdowns are not measured in C2’s “max drawdown” statistic. You can find this info in the csv file of performance. Just put it into excel and sort on the drawdown column.
Here are a few of my favorite quotes on risk & profit:
“The amateur trader looks at profit potential first. The pro starts with risk and works backwards.” Futures Truth magazine
“At the end of the day, the most important thing is how good are you at risk control. Ninety percent of any great trader is going to be the risk control.” ~ Paul Tudor Jones II
“The Market Can Remain Irrational Longer Than You Can Remain Solvent” (variously attributed)
“In theory there’s no difference between theory and practice; in practice there is.” Yogi Berra
“Take care of the risk and the profits will take care of themselves.” (various versions of this idea out there)
In practical terms, what I’ve started doing is looking at the max DD in the C2 record and/or the backtested model. Then I set the allocation so that if the system hits its max DD again, it only takes out 5% or 6% of my account. I’ve just set things up this way, so we’ll see how the year goes with that concept.
Second, brace yourself for drawdowns. They are hard to take. However, if you switch methods after drawdowns you will just lose money. Diversification helps here, and is a reason to have at least one steady-as-she-goes system in your portfolio.
Be patient and stick to systems with a track record of a year – don’t go chasing high flying systems with only 3 months of record.
To answer your other question – I am very happy with C2 & autotrading.
Finally, “A man’s life does not consist in the multitude of his possessions” (Jesus)
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"Derivatives – everything but equities on C2 – are so much more risky than equities are. They can cause rapid loss of capital"
The ONLY thing that can cause rapid loss of capital is poor or no money management, not the financial instrument you are trading, period.
Some great points,but you can actually see the “intraday drawdown” simply by placing your mouse on the “?” that appears on the Risk column on the main Trade Record page for each trade made.
You have brought up some great insights but having a system with a “track record of a year” is no guarantee of success going forward either. What you see here often on C2 are systems that simply are living off their “past glory” by suckering in unsuspecting subscribers (often new to C2) based on the “long” track record of the system even though the system’s current state of performance may be deplorable. IMO, the key is consistency, time (in the market for a trade), risk and loss management…and not necessarily longevity.
I would rather trust and follow a strategy that has successfully made a plethora (let say 100 or so) of great trades in a short period of time (e.g. 6 months) instead of one that has made a smaller amount of trades (e.g. 20) within a longer period of time like a year or two or so. The market is naturally geared towards the upside (or else the mutual fund business that supports major businesses/employers’ 401ks etc. would go bust), so anyone can make money if one has the means (i.e. $$$) and time to be able to stay in the market long enough to tolerate the inevitable draw down long enough. It is not hard to guess and wait for time (that is if you can afford it) to bail you out when you are wrong (which is what most traders/investors do). The real question is how much risk and time/stay in the market are you willing to tolerate in order to achieve whatever goals and profits you want.
Whether stocks, options, forex or futures, it really doesn’t matter. Just look at the Statistics section of the systems and also filter the columns in the C2’s Grid if you really want to get a clue and an idea of what is truly going on with each system (the numbers don’t lie).
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so which stock systems are you trading now? I would like to check them out.
“The market is naturally geared towards the upside”
Hi KT,
What you just said is true, if you were talking about the stock market, US or foreign.
However, the buy and hold approach, touted by Wall Street “analysts” as a “sure thing”, simply does not work anymore.
Investors/traders who bought Dow Jones stocks in 2007, for example, had to wait more than 7 years just to break even.
Yes, 7 years just to get your money back, can you imagine that ?
That means no (zero) income for seven long, long years!
So if you were counting on that money for retirement, well think again.
That’s why active money management (with the goal of outperforming an investment benchmark index like the S&P 500 or the Euro Stoxx 50) is the key here.
Buy when the market is up, sell short (or buy put options) when the market is down, that’s the secret right there.
But one thing is for sure these days : Buy and hold (hope is the correct word) is a very risky investment move.
Anyway.
You mean they doubled their money . Look at dj total return :
“You mean they doubled their money . Look at dj total return :”
Look at the charts again, it took these “investors” 7 long years just to recover their losses.
Add the usual 3% inflation rate (in some countries inflation exceeds 20% per year) and now these same “investors” have a negative rate of return, on top of their huge (buy and hope) losses.
Quite an “investment”, indeed!
See, on these beautiful charts, they almost never show you the inflation-adjusted rate of return.
Because add the never-ending inflation and you will get an entirely different (and rather disturbing) reality…
That’s why investors/speculators/traders need to time the market with time-tested trading systems like the ones showcased here on C2, or elsewhere.
