There has been an outpouring of love on TMG - 4 shining testimonials in about 3 days (below). However, things are not always as they seem. This analysis of TMG trades (since bottom of its post Feb. 27 trough to present). Trough-to-Peak is the most glowingly profitable situation for a system. Anyway, taking the total profit and APD (and separating) its LONG and SHORT calls:
--------LONGS: total profits $10,925 APD 1.5
--------SHORTS: total profits $443 APD 0.03
In other words, TMG did little more than ride a strong bullish period. On the other hand, a truly impressive system (that outperforms) makes significant money on both its long and short calls. Anyone buying and holding would have made about $10,800 during this time. Throw in $375 or so in system fees, and a few commissions, and you would have performed equally well…
4 hymns of praise seems somewhat unwarranted, a little suspicious, and somewhat
naive.
System had a tough stretch but looks to be back even stronger now. Currently at a new equity high. Sure anyone can make money in a bull environment but Merlin has also been able to follow the short term retracing. All in all I’m glad I was able to jump on this train. In addition, the experience of the designers and other subscribers is exceptional. My trading has improved. Trading options on the Q’s.
Great system. They had a rough time for a while this spring but tweaked the system on 5/7/07. Since then the system has been right 11 in a row. The system is easy to trade and the developers are always available and help full. The system uses QQQQ, but I trade QLD for long trades and QID for short trades to get more punch
I have been a subscriber for a few weeks but also known the creators for months prior to that. Imo, this is as good as it gets for trading short term moves in the market, both up and down. I use proshares 2X qqqq funds for the longs and shorts and have done very well. I am currently allocating 100% of my trading capital to this program.
I am sick of seeing negative reviews of beginner “traders” that now start ripping into a solid system that just went into a drawdown of ~6% amidst turmoil in the global financial markets. Things you need to know: 1. This is an EOD system, and thus can not guarantee you will not be hurt by gap up or gap downs. That’s just how things are, you can’t blame the system developers. 2. Drawdowns are a necessary evil for any system and any mechanical trader, if you can not take the heat of being down -10 or 20% then do not trade! I give this system 5 stars because I do not know
We’ve had this discussion before for another system (i don’t remember which one), but I think the common way to determine if a system is simply leveraging a particular benchmark, is to look at alpha, beta and the R-squared.
Using daily values, the advanced statistics show a very small R-squared, which essentially means that the system doesn’t have a particularly strong relation to the (S&P 500) benchmark. In addition, beta is 0.05, which is extremely low as well and alpha is 47% annually (and statistically significant).
Moreover, being long QQQQ from the date of inception of TMG till today, would have given you a Sharpe ratio of less than half that of TMG.
So to me it is a big stretch concluding that TMG is simply riding a bull trend just because it has generated most of its profits from long positions.
In fact you might also argue that the system has done a good job identifying a bull trend correctly, even though it is not a long-only system. Similarly, why wouldn’t the system be able to identify a bear trend as well and profit from it once that trend occurs?
(By the way, I agree that the recent reviews appear a little too enthusiastic. I didn’t write any of them)
"Moreover, being long QQQQ from the date of inception of TMG till today, would have given you a Sharpe ratio of less than half that of TMG. So to me it is a big stretch concluding that TMG is simply riding a bull trend just because it has generated most of its profits from long positions. "
True, except the bigger question is dealing with performance since the Feb. 27 downdraft. Underlying market geometry is constantly shifting. Many systems cannot keep up, as they are tuned to a particular period. TMG doubled the amplitude loss of the S&P, and has been only keeping pace since it bottomed. The question is whether it has lost it.
The road to well intentions is littered with C2 systems (and thousands of other out in the webworld) that boomed for a few months, and then either went random, or blew up.
The many kudos is very strange, because it suggests some subscribers cannot distinguish between keeping pace and real outperformance. The fact that it puts money in your pocket means little, if you could do that by just following the market on a buy and hold for the same period.
A better test, is if the bull really stops, and see how it does with a sideways or bear market. Then, the kudos may have some value.
Heck, I may even subscribe.
I don’t agree that one has to make good money on both the uptrends and the downtrends to be deemed worthy. My website KC.com has posted real-time trades with ease and simplicity that beat markets by more than 25% each year.
So you want to argue with me that that is somehow irrelevant? That flat-lining during down periods simply means I cannot make money in all directions so I suck?
This info must’ve come from some textbook theology studied by those that think they know - when in fact their frustration is that they can’t put 2 and 2 together.
I do know how also capitalize in down markets and have started a thread to demonstrate as such, but it’s not about me:
http://www.elitetrader.com/vb/showthread.php?s=&postid=1497670#post1497670
If you ramp up 40-60% gains during uptrends and somehow manage to keep those gains during the inevitable downtrends - those that think they know only wish they had these gains with their funds - because they’d literally go right throiugh the roof.
Show me one person that can ramp up gains and keep them. The rest is just Boo-Hoo. Gilbert
> In other words, TMG did little more than ride a strong bullish period. On the other hand, a truly impressive system (that outperforms) makes significant money on both its long and short calls.
Ross, you are not fair in this context. If the market’s only significant
movement is up during a time period how is any system going
to make “significant money” on the short side? No system is 100%
efficient and in “a strong bullish period” sell signals from a two way
system may do well to break even. Some form of trend filtering
makes sense and it would serve the system well to have a bullish
bias. We can be critical of how TMG handled the Feb-March decline,
but it’s silly to point out they stayed mostly long and made most
of their money on the long side in a rising market since then. Anyone
who has done this for a while understands we need a larger bearish
sample to see how well TMG will do in a downtrend.
> TMG did little more than ride a strong bullish period.
True, but give them credit for getting long quickly after a sharp decline and staying mostly long to "ride a strong bullish period."
That said, I agree the love for this system seems
inflated relative to reality. I’ve commented before how I thought it was strange how TMG is ALWAYS at the top of the most looked at list.
Check out the comparison to Swing NQ. Both systems are about the
same age, for my taste SwingNQ is a slightly better system (better return vs DD, higher sharpe, etc.). SwingNQ actually uses stops!
SwingNQ is only using a small % of available margin (10 lots).
Anyway, I’m neither endorsing or dumping on either system, but
I find it odd that TMG has over 400% more views in the same
time frame:
TMG
Viewed 20,556 times
Compound Annual % 59.9% over 228 days
Sharpe Ratio 2.899
Eternal Return Trading - SwingNQ
Viewed 4,783 times
Compound Annual % 205.3% over 238 days
Sharpe Ratio 3.45
Yeah I just looked at TMG a bit more in depth. All I can say is I AM ENCOURAGED. I know you heard it before so I’ll spare you the drivel.
But check this out! TMG did pop out as a top system when I first came to C2. Reviews I had posted seemed of key value. Congrats on the idea (however skewed) most will/should get some (reviews) for their systems.
Nothing hugely phenomenal (although successful up to now). And 20,000+ views and those reviews are actually (sorry: rather inept) subscribers???
Cool C2 is great value to vendor. (Another question I had previously asked - all I got was mum). So “stock” systems can do good at C2. ~50% annual is well liked. Short track records are received well. Ridiculous DD is overlooked. Making 7% in two weeks is worth hooting over and $120 is good price.
Eu u suck (sp.) KIDDING! You making ton! Of course your own accounts must be doing well:)
TMG got in at the (near) exact bottom to last years Nasdaq correction. Luck or skill? This years DD knocked off 50% of those easy gains. Looks like recent run was let ride…where to now???
…very encouraging indeed. Good Luck vendor(s). (In all truthfulness I do wish u well).
Oh and I need to change my system description jargon: "In accordance with the affore-mentioned extranous purportment, one can with most certainty be assured that the due-diligence supremely required does in fact constitute the fair and amiable practice of lovingly and gladly taking your money for this absolute guarantee of true benevolence to all - after all we are system developers that have transcribed to you as such an enormous amount of astuteness and expertism that we will show. (or something like that - that actually almost sounded like me)Gil
…and you gotta love it - trading all the capital in each trade…where is this one going??
I find it odd that TMG has over 400% more views in the same
time frame:
That ratio is not unusual when comparing views between futures systems and stock/forex system in general. E.g. Hawk-fx and extreme-os both have more than 40K views, while it’s hard to find a futures system that exceeds 15K. In fact, if vendors of index futures systems are not fully satisfied with the number of subscribers, they should consider adapting the system for ETFs if possible.
In addition, TMG does a fair amount of marketing itself with their website, discussion group etc.
I also think TMG is popular because it’s easy to trade and allows for a lot of customization (e.g. with options, proshares, or even futures).
2ST so stock funds still in vogue despite huge potential gains from futures vendors with auto-trade.
Also threads with system work well - good thx.
You should be paid for that bit of direction (transition vendors to non-decaying instrument).g
"I don’t agree that one has to make good money on both the uptrends and the downtrends to be deemed worthy. "
Not the point. The point was that a truly outperforming system can make money with both its long and short calls during trends. TMG is an all day, all night system. If a system can follow a trend, then it offers minor value add.
I have tested scads of systems for 12 years. The ones that can make money on both sides, have almost always been the ones at the very top.
Hey Ross…all things aside, have you found a system that can even hold an uptrend with significant jump year-over-year for more than 3 years? How about 5?
If that system jumps (significantly) and holds year-in and year-out - do you really care that it is "only" capitalizing on the uptrends?
Perhaps show us what you refer to as a good system - containing these esteemed values. Still in wonderment, GiL
2R "I have tested scads of systems for 12 years. The ones that can make money on both sides, have almost always been the ones at the very top."
a simple short list would do.G
awww where are the italics?!?
several, but not on C2.
And no, they will not be supplied upon request.
Too funny…
Ross was trying to draw away from TMG, and look–>… a new forum thread that is drawing even more hits and subscribers to its system.
This is the reality of systems available on the internet. This one was on top, of the C2 advertising
http://www.prosignal.net/images/short-term_yearly.gif
note the sudden plunge this year in the last column? How come when they advertize to the public, they always seem to do so much better in the past (ie, using rosy-scenario backtesting?)
lol
> That ratio is not unusual when comparing views between futures systems and stock/forex system in general. E.g. Hawk-fx and extreme-os both have more than 40K views…
>I also think TMG is popular because it’s easy to trade and allows for a lot of customization (e.g. with options, proshares, or even futures).
Maybe…but subscribers don’t need to check TMG on C2. I would guess
non-subscribers and potential subscribers account for most views. TMG
doesn’t come out near the top of any list except most popular / most looked at.
See stock system Trendplays:
Compound Annual % 108.9% over 366 days
Viewed 2,677 times
vs
TMG
Compound Annual % 59.9% over 228 days
and TMG has 750% more views in two-thirds the time on C2.
Hawk and extreme have been around a very long time AND were
at the top Compound Annual % list for long periods.
Sometime watch the C2 ticker for a minute or two. TMG seems like
it gets every 3-4 hits there. And it’s "most looked at this hour, it’s
most looked at last hour, and it was most looked at the hour before
that… pretty cool since C2 now ranks the initial grid search on # of views… I LIKE TMG, but the performance vs the popularity seem out of whack.
For me, an important difference between TMG and SwingNQ is that TMG is easier to customize, as Science Trader pointed out. This is so because TMG is an EOD system and SwingNQ a daytrade system. The only way for me to trade SwingNQ is if I autotrade, but then there is practically no customization possible; e.g. it must be futures. For TMG on the other hand, I can ignore trades or adjust position size according to my own insights or the signal strength, use options instead of ETFs, and chose other entry or exit times.
I agree that the reviews lack the usual scepticism that characterize other reviews at C2. I also agree that is too early to tell how the system performs in a bear market or a sideways market. The low APD of the shorts in a bull market does not prove anything in itself, but in this case it is perhaps related to a weak point: The events that caused the DD (and the low short APD?) show that the system can be zigging while the market is zagging, and this will become a problem if such a pattern continues for a longer time. But then every system can have a bad period, of course.
You guys wrote 5 posts while I was writing 1. Too slow again 
"Maybe…but subscribers don’t need to check TMG on C2. I would guess non-subscribers and potential subscribers account for most views. "
That’s true. I don’t understand the many views either. Their website contains a link to C2. Could it be that every time a subscriber opens the TMG page with - incidentally - the C2 equity curve on it, this generates a view of the system at C2?
2Ross: too funny…your subversive attitude. No - let me tell it, “If you told us you’d have to kill us, right?”(lol)
Too bad I don’t know BOLD yet. Ps
