I agree with Kevin 100%, this is a great idea. Very quickly you’d see the systems such as enchante which use martingale strategies disappear, no developer is going to risk their actual funds on such a system, but as it is now it’s easy to risk other people’s funds while taking their money until the system blows up…
Regards,
Dave
It looks like the vendor of Enchante (now renamed to Test) which had its steep decline in March started about the same time a new martingale system called Forex Wave System (now also renamed to Test but you can still find it if you type the original name in the search field) which, of course, met its inevitable outcome as several people had predicted. Nevertheless, he got quite a few subscribers. So we can expect that he (or under the pseudonym she) will come out soon with another martingale system.
The problem with having developers trade their own cash in their system is that the performance via C2 is too detrimental. Latency and commissions are higher than elsewhere and this can be significant. I use my systems to trade my own account, but would not do it through C2’s auto-execution. I run on a server near the exchange and get very good fills and low commissions. Also, C2 charges an auto-trade fee on top of commissions that would double what I pay now. The auto-trade feature at C2 may be acceptable for retail clients as you provide a service they have a hard time finding elsewhere. However, that is not true for the developer.
In short, if you can create a live trade-verification for signals that don’t go through C2 “auto-trade” then that is feasible. I clear through Vision Financial, so perhaps they can verify, for example?
I wanted to be clear that I have not auto-traded on C2! Someone thought I was suggesting that I had in my post. What I was presenting was my concern for using the C2 auto-trading feature for my own trades, in hypothetical terms. What I have done is experienced latency between two competing brokers, and the differences can add up. It is open to debate how well C2 compares to other server-based solutions. My point as a system developer is that I do not wish to verify my trading in this way.
In my previous post I forgot to mention the main point I wanted to make:
Vendors should be required to give their real name to be verified by C2 or at least have that option so that subscribers can decide if they really want to deal with a fake person who might have had several failed systems in the past.
Agreed Karl. More than one vendor has tried to hide from his record here.
I suggested an IP address (or part of an IP as in 192.X.X.101) be listed for each vendor’s last login (or for a posting on the forum, or a review, or an analyst posting) which would allow tracking of specific users (not tracking who they are – but if they start a new account the same IP would show up). Yes I know you can fake an IP address and can post from the local library, but most people are just too lazy. And all it takes is one slip up to catch them…
Another way would be for C2 to assign a unique ID to each user which is used no matter how many times you register. It could be tracked by C2 using the SSN you provide to get paid, or via some other method (a passport number for foreign users). Yes this would be onerous and a pain but I’d gladly put up with it if we could keep scam artists out of C2.
Regards,
Dave
I guess this begs the question…
If you believe that C2’s autotrading function would have a significant negative effect on your system’s results, how do you expect your subscribers to be able to effectively trade your system?
One of the main benefits of autotrading your own system is to “spend some time in your subscribers’ shoes.” You may have a fantastic trading system, but if the limitations of publishing the signals on C2 prevent your subscribers from achieving even modestly positive results, it might be a good idea to know that ahead of time.
Even the best system is no good if it’s untradeable.
"Another way would be for C2 to assign a unique ID to each user which is used no matter how many times you register. It could be tracked by C2 using the SSN you provide to get paid, or via some other method (a passport number for foreign users)."
That’s an elegant solution, Dave! Matthew could program that so he didn’t have to waste his valuable time tracking the scammers manually. And the vendors could maintain their anonymity/privacy if they chose to do so while still having full transparency of their history on C2.
Matthew, are you reading this?
This has been an issue since Day 1 on C2 (and every other signal service, for that matter). I remember this topic being debated 5 years ago.
No matter how elegant a solution is developed, someone will find a way to circumvent it. And cheaters, rest assured, will always try to cheat.
Luckily, cheaters mess up eventually, and sooner or later are exposed.
This is âsound goodâ silliness. A system is either good or it is not good. The only true way to determine if a system is good is with time. âWith time there will be illumination.â
The only people who can be scammed are those who want to trade young unproven systems most of which will fail anyway. With time scammers are brought to âlightâ as are all other bad systems or traders.
If you say so. I think C2 subscribers would be interested to know that Vendor X is the same person who crashed and burned some other systems. How can more transparency be a bad thing for subscribers? Enchante looked pretty good for a while…
I think there are two issues for ip address. The first is it may be against privacy policy. The second issue is different people from the same big company might share the same ip address.
What if C2 tells us vendor X is also vendor Y, when in reality vendor Y is sharing the same trading computer with vendor X. Some people do live together and share things.
Failed systems are on the path to building good systems and no one should be judged by their path to success, only by the success itself when it comes. Some who try the martingale approach may believe they can make it work much like some believe they can make Marxism work. Some must experience to understand. This also applies to subscribers picking wrong systems. Some must experience to understand.
Yes, people can trade however they want. The issue is not how you trade, the issue is about being transparent to subscribers.
If you want to trade using the martingdale approach, thats fine… but subscribers should be made aware of how risky the system really is.
I think C2 should have better statistics in terms of how risky a system really is, such as:
1) warning subscribers that this system has had drawdowns of over 100% in a single trade which would have blown up their account.
2) show how many "extreme" trades and how many trades have had drawdowns of 25% or more.
3) risky systems should also be in red or in a different category all together.
Something along those lines. These are just ideas to separate developers who are trying to build a serious business from people who are just playing around.
Excellent point. This is part of my consideration for becoming a developer here at C2. But it is not quite as simple as you state. I have a highly profitable system that I developed for Ninja Trader. I have been trading it for my own account for the past year, and it makes $20,000 / year per contract. It can work with accounts as small as $5000. I recently wanted to add contracts to my account and decided to do this with an account at a second brokerage. So my first account was at Interactive Brokers, and the second account was at Optimus Futures. I ran the same signals to Interactive Brokers as to Optimus, but then things started to diverge. I noticed on the first fill, that even though I placed a limit order to Optimus, I got a fraction of a point better fill. This means that on my daytrading system both the entry and exit were 0.1 to 0.2 better. This is $2 to $4 better per side, meaning entry and exit. This doesn’t sound like much, but it means my system will make $2000 to $4000 more per year. That is 10% to 20% better return without any increase in risk or cost! And that is per contract! So you do the math, this is very important.
Now back to your point. My system is still making $20,000 per year per contract at Interactive Brokers. Is it wrong to offer that return here at C2? No, that is still a great return. But I would not volunteer to do this with my own account; why give up a guaranteed $2,000 to $4,000 per contract just to sit in other people’s shoes? - Now remember, I have not compared C2 to Optimus or C2 to Interactive Brokers, so this is in theory only. But the concept still stands. If C2 has worse fills than Optimus, then I would not trade through C2 for my own account.
