There are a few in the loss and win column. Must be at least one shared data glitch to be remedied by MK
I withdraw that.
Yes, let profits run is a skill, but a highly profitable outcome is not necessarily caused by that skill. On the other hand, I would not go so far as to label it always as a matter of luck.
We should specify what we mean by an “outlier”. My definition is: an outcome that exceeds the bound defined by the 3rd quartile + 1.5 * the interquartile range. This implies that the percentage of outliers will usually be small. Even so, this small percentage may consist of hundreds of trades. If that is the case, I would consider these outliers as the result of skill rather than luck.
If there only a few of such trades, say two, then this could be the beginning of a set of hundred or it could just be two lucky guesses. Every vendor will argue that it was his skill, so that won’t help me. In that case I am, like ST, inclined to stay on the safe side and assume that it was luck - untill the track record show otherwise.
However, it also depends on the leverage that was used in the outlying trades. If a high return was obtained on a excessively leveraged position, I will certainly regard it as mostly a matter of luck. Because, as has been said, there is always some chance element involved, and he was lucky that the trade didn’t go against him. If the a high return is obtained with a modest position in stocks that made a big move, then it will be much easier to convince me that it is the result of predictive skills.
I find it hard to imagine that a position that has been left to run for a considerable period of time can be viewed as luck as I believe to let profits run is actually one of the hardest things to do and requires tremendous discipline. I’m sure we’ve all watched a trade go well, taken our profit and patted ourselves on the back, only to later watch it carry on in the same direction for a gain twice as much as we sold it. Taking profits is the easy bit, letting them run requires discipline
I am in total agreement here. Thanks for mentioning it.
Jules, your knowledge of statistics is far beyond mine, so I’ll just agree with you. 
But most systems I trade have about 60% losing trades, with about 20% of trades accounting for about 2/3rds of profits.
Let me try to translate my own words 
Ignore the details of the definition of outliers that I gave; they are not important. Other definitions exist too. My point is that even if the outliers are only a small percentage (say 2% of the trades) there can be many of them (this 2% can be 80 trades). In that case I will not consider those 80 trades as merely a matter of luck. But if the system has only 50 trades in total, and 1 of them is an outlier (which is also 2%), then I will assume that it was just luck untill such trades have happened much more often.
Makes great sense to me, Jules. I agree, FWIW.
There has been some really interesting discussion in this thread so far.
"2) Communicate with the vendors and get a picture of the (wo)man behind the system."
To add to this, I’m really enjoying the vodcasts from one of the systems I have subscribed to. This seems like a valid way for the subscriber to get a feel for the amount of thought and intention goes into each trade. You might even get a sense of which were the lucky(-ier) trades. From the point of view of a cautious subscriber I would like to recommend system vendors to do this if they can, because it has the potential to generate a little more confidence. What do you think?
WhyNot (only $290 a trade!)
EZ Trade
I mentioned BurstTrading because, at the exact time of my post, it was down three million dollars ($3M)… likely due to some calc glitch.
I must admit that psychological components have also some effect on me, besides the statistics. I don’t know if that is wise. For a mechanical system it doesn’t matter. For other systems I wonder sometimes whether it is perhaps even the most important. I’m not talking about the kind of personality that the vendor exhibits on the forum, but what he shows in his trading. Only the problem is that you can’t get objective information about that.
Curious/Need to know:
I agree in that a lot of the ‘luck’ will be evened out over time, as market susceptibilities inevitably unfold.
With that being said - Of all the systems that have propagated these past few years, have any closed out with ‘great’ success? In other words, gone on to bigger and better avenues.
If so…which are they and can they still be analyzed?
Also, does C2 release info such as volume of subscribership base per system?
Yes, look up "Short-Term Stock Index Program" by a vendor named Dustin Dubia.
You can see all systems (including those that were terminated) in:
"1-Click Searches". Pick an instrument (e.g. stocks, futures) and then click "show all".
A while ago someone who claimed to be a hedge fund also posted on this forum, asking vendors with excellent track records to contact him.
It’s very funny thread lol You’re trying to use stats for events that you don’t understand and in the case the stats is very misleading.
Maybe I’ll say you bad thrush, but stats depends from understanding of underlying events. You’re making common mistake by putting stats as leading even. Bad for you.
Hehe. There are only two types of systems at the market. There are:
1. Trend following. A lot of small losers and rare big winners.
2. Scalping. A lot of small winners and rare big losers.
Period. You have to recognize type of the system and adjust stats for the type.
It’s very funny to see, how controversial stats applied to different type of systems in attempt to find a Holy Grail/ATM for a subscriber.
Cynically, I haven’t any wish to help you, but your misleading by stats is funny thing
Eu
First of all, by pure logic, you can’t make such a rigid distinction between 2 types of systems. What if a vendor develops systems of both types and mixes their signals? It would be a new system that would fit neither your “trend following” nor your “scalping” type of system. It would show all sorts of winners and losers, both big and small.
Second, there are many examples in practice of systems that fall somewhere in between. Take for example Trend Plays #1. It has more winners than losers, and the average profit is larger than the average loss. If you look at the individual trades, there are no outliers. Even though the name suggests it would perhaps belong to your “trend following” class, it clearly doesn’t fit the definition of “A lot of small losers and rare big winners”.
What if a vendor develops systems of both types and mixes their signals?
I’m glad that you mentioned that. Mixing of the two kind systems is a mark of a master. Hopefully, I won’t destroy your believe if I say that I don’t see the kind of systems in C2
Second, there are many examples in practice of systems that fall somewhere in between.
Good answer, but the answer is meaningless. Tossing of a coin doesn’t represent a system. You may believe to whatever you want It’s your right. lol
If you look at the individual trades
If you look at individuals trades from point of view that I represented You’ll understand why stats is meaningless sometimes. Simply, if there isn’t system stats represent random events.
Eu
P.S. It’s funny to see the market meat in it’s attempt. Sorry, I’m again cynical 
That’s great…but upon analyzing all (past and present) systems, I would think the past winners would present themselves with the “1-click” screen as nice ramp-up or exponential growth over 2+ yrs and then a flatline to the present - perhaps with note like Dustin’s…“gone on to better things”. I’m not seeing it (or many) or is this 3-4 yr venture still new or the market for subscribers still small, perhaps waiting to be tapped? Perhaps true management prowess is ridiculously few and far between - at least to the public eye. Just my thoughts.
I think for many systems there is no “nice ramp up” over 2+ years, b/c it’s apparently something hard to achieve for the average vendor. I guess this means if you’re confident that in your case it shouldn’t be a problem, you can expect to get a lot of subscribers, relative to other vendors. How that translates into an absolute number of subscribers and revenues is an open question that depends on a lot of other things, e.g. scalability, slippage and your fee.
Maybe I’ll say you bad thrush, but stats depends from understanding of underlying events.
One of the points in this thread was that if the profit depends on a few big winners, the subscriber must be patient, and missing one trade can have a great effect on his outcome. Why is it needed to understand the underlying events for that? To draw this conclusion it is enough to know that the winners are rare.
You have to recognize type of the system and adjust stats for the type.
Then, what kind of adjustment do you suggest?
Eu I think there are more than 2 types of signals. Overbought and oversold indicators haven’t been mentioned here.
systems, not indicators…
