Hi Science Trader,
I think you are right. But, that doesn’t really matter. Getting subscribers is only one reason I am on C2.
I personally think if I can put good performance in over a three year period, in line with my historical results, then I will probably get plenty of subscribers.
>So, I changed this trying to anticipate future profits based on past performance. I would much rather have this based on actual performance, but the site only gives me limited options.
Using the tool of past history as an indication of the future ignoring the fact that the probability of the distributions not being stationary makes the entire concept seem like a costly (perhaps very costly) mistake.
If I know that there may be rare events (black swans) in history, then I cannot infer anything about the properties of the data, quality of the trader or the strategy under consideration, solely from past returns.
If I do believe that there cannot be rare events, then I can probably start
making a judgement on the asset, the trader, or the strategy.
When you start investing or trading, you are stepping into the world of random numbers. Nothing is for "sure", and only the laws of probability will work.
You can lose your initial capital using any "sure" system. The question is what is the probability of winning or losing.
Only statistics garnered from a back-test on the forwarded-tested results can answer that, not one garnered on a back-test on static signals.
So, your argument of taking 20% of profits on a back test conducted on static-signals is indeed quite a stretch, ignoring reality. The reality is 20% of actual realized profit and only when a new equity high is reached which is the industry standard.
Do yourself and your potential subscribers a favor and switch to a fixed monthly or quarlerly charge for subscriptions.
I dont’ agree.
Purley displaying the Pips does not take into account Money Management which is the most important skill after good psychology.
What does it matter if someone makes 1000 pips if the drawdown
was -750 and the overall profit was only 1% of the account?
The Percentage Gain of the account compared to the Max Drawdown of the account combined with consistencey (i.e. a good W:L Ratio) is far more telling than Pips.
If your Lot size is proportionate to the C2 lot size then your %age gain will be the same with the same &age risk.
Good luck with everything.
Thanks for your help there Andrew. Your comments , especialy on pricing are very useful.
Good luck with everything.
"What does it matter if someone makes 1000 pips if the drawdown
was -750 and the overall profit was only 1% of the account?"
Drawdown of 750 compared to 1000 pip profit is NOT a problem. In fact, that is several times higher ratio then most of the profitable systems here. Keep in mind you are comparing MAX DD to NET profit, not MAX profit.
"The Percentage Gain of the account compared to the Max Drawdown of the account combined with consistencey (i.e. a good W:L Ratio) is far more telling than Pips. "
Good win:loss ratio is mostly irrelevant. A 90% win ratio with modest sized wins and large-sized losses is good? A good system has a good profit/loss (all profits/all losses) ratio
Two points, one of which I have said many many times on these forums:
(1) I can’t charge on actual profits. I can only adopt a method in line with the constraints of this website. I believe the subscription method I use is appropriate given the constraints I am faced with. I have stated elsewhere that the forward tested results are currently in line with the backtested results.
(2) It may just be my interpretation. But, you come across as you like to lecture on very basic facts about trading, like the probability of trading. You seem to assume with some of your posts that none of us have actually traded in the real world.
>I have stated elsewhere that the forward tested results are currently in line with the backtested results.
Again, you missed the point. Forward tested results however good it is, is still not a productive achievement nor does it work yet to support man’s life. If the trader is to qualify as productive, he must proceed in due course to the next step. He must give their discoveries some from of existence in physical reality and not merely in their consciousness and then and only then one can base their subscription or commission rate on profits (usually through managed accounts or hedge funds) which is not possible in C2’s hypothetical world.
>You seem to assume with some of your posts that none of us have actually traded in the real world.
I disagree. But, I do agree with you on other things you said like: day-trading the ES is one of the toughest games in town…
