To the providers

Collective2 clearly suggests the default conditions, but I am asking to the providers: in your opinion, what is the best formula to have subscribers? We are inserting a new overnight system for currencies but we would start in the best way. Many thanks.

If you follow the forum discussions here, I think these are the most important themes:



1. Clear system description about risk management and margin requirements: Do you use stop loss rules? Do you hold overnight positions? Do you do daytrading? What is the maximum size of a single position? Is your system 100% computerized, or do you trade at your own discretion?



2. Stick to those rules, NEVER violate them. If you change the rules, warn every subscriber long before.



3. Make system easy to follow: Use market orders, not limit orders (especially when closing a position). Make sure that subscribers have ample time to follow the trade (a few minutes delay should not ruin the profit).



4. Minimize draw downs. Most people don’t like them. Even when they are in open positions.



5. Make profit.



6. Have a long track record on C2.



7. Give a long free trial period. Many people will ‘believe’ in a system only when they’ve made at least 30 - 100 trades themselves.



8. Personally, I like a fixed monthly fee more than a fee that depends on the profit. The advantage of a fixed fee is that I always know ahead what I’ll have to pay. The disadvantage of a profit-dependent fee is that it may encourage the system vendor to do some very risky trades.



9. Communicate politely and patiently with everybody, both subscribers and non-subscribers. Give sound and honest answers to legitimate questions. Don’t say things like “If you don’t like my system then stay away” or “I am only interested in trading” (suggesting that you are not interested in your subscribers money). Other people will read that too.



Hope this helps.



Jules

Excellent post Jules! I especially liked #5 :slight_smile:

Jules,



You must have been reading my system description :slight_smile: Seriously though, every vendor should strongly heed your points before they put their systems out in front of the public. Excellent post.

Jules,

Excellent response. I would add one thing—Be careful not to take unrealistic position sizes. You aren’t going to find too many subscribers if you are too highly leveraged and your RF is not near the maximum. That might go along your #1 and #2 themes, but it is amazing to see how many vendors add and add and add to losing position to the point where such trading in a real account could bring on financial disaster. Bottom line—Make sure your system trades how a real person with real money would trade, otherwise, you won’t find a real person with real money to trade it!

In particular to mr.Ellis but also to all folks: many thanks for the replies. When mr.Ellis says that the system shoud gain (point 5) , it is surely for listing and exhaustive purposes. It is clear that if the system does not gain… But probably the suggestion is deeper: do not create conditions in which you can lose a lot. I.e.: in this moment I am the provider of an Energy system. The danger to lose is important.

Another important thing is the price: I started with 729$ a month and now I am at 199$. Are you so kind to offer some suggestion about the last argument? (but not the least).Good work

(here comes one of my long posts again…)



Yes, I listed point 5 (make profit) to be exhaustive and it is also a little deeper: It is less important than point 4 (minimize draw downs), at least for me personally. I should have written that down, because the order of the other points does not necessarily reflect importance.



The actual price is important too, I agree (well, there is still a point 10 that should be filled…;-)) . I find it difficult to give a general recommendation for that. I’ve paid $168 monthly for a relatively young system that seemed very profitable for several weeks, but I had a long en large draw down when I started to trade it seriously. So I will never do that again. Now I’m subscribed to extreme-os, which is well-known and satisfies most of the above points, and it’s price is $50 monthly.



So I would not consider a system that asks more than $50 unless it really outperforms extreme-os on some weighted average of these points. That is near to impossible with respect to points 1 (system description), 2 (stick to rules), 4 (minimize draw downs), 6 (long track record), 8 (fixed fee), 9 (communication), and (let’s say: #10) leverage. So the only points on which you can reasonaby try to outperform extreme-os (imho!), are points 3 (easy to follow) (slippage can be a problem for extreme-os, perhaps due to the many subscribers), 5 (profit), and 7 (free trial period) (extreme-os has none). For example, I seriously consider Pinnacle and MBN-1 because their profit may be much larger.



Well, perhaps I should als mention point 1: the system description of extreme-os (on his website) is clear, but extreme-os holds positions overnight (some people don’t like that) and has no explicit stop-loss rule (except selling the next day) while some people appreciate them.



But I must warn you that I’m perhaps not a representative subscriber. I don’t like leverage, while there are a lot of people here who trade only leveraged instruments (a kind of anti-# 10). And I’m probably relatively poor, so other people may be in the position to wage more money.



Intuitively I would say that for a young system with a few weeks track record a monthly fee of $99 would be the absolute max, and only if the profit is exceptional and all other points look excellent. Of course, if you make a million in a few months, then the situation is really different and then $999 would be possible.



But frankly, most systems do not even come close to a situation where I would pay $99 for them… For most systems it is rather the opposite in that I would not even trade them if they payed me…



Perhaps it also helps to take a look at some recent popular systems like Black Dog. I don’t know what they cost.



Succes!

Jules