Re: [amibroker] Re: Do all trading systems stop working? - Howard Bandy's book

[malcolm Crouch <malcolm.croucher@xxxxxxxxx>]

Its a funny Conversation this .

If All systems will eventually fail then 

 The underlying theory must be wrong .... so therefore dow theory , elliot wave theory , fundamental economic  thoery  ect must all be wrong ... except these are the underpinning of most practitioners. which leads us to say then All textbookss are wrong  and all academics are wrong .. which say all universities are wrong .....

So therefore most education in the financial markets will eventually fail ...

So this could bring us to a conversation about the random walk of stock prices ...... which would lean on a quantitve side ... which would fail .

however there are practictions making from -100% to plus 1000% per annum .... so i would say not all 
Systems but rather the Individuals designing the system fail .

Perhaps the education  fail in a sense... 
The learners fail ...
The work experience fails 
so perhaps all that is needed is the correct  hard work and the correct  study and the correct experience
(which would be very difficult with limited resources )



I would imagine you are defining the problem  wrong, when actually the   problem is the greater environment  not the system.

i think a classic example of this is the current weakness in the market in a way the education system has failed , the regulatory system has failed and executive management has failed (to name a few )

The world has a long way still to go ..... we are a  young civilisation .


Regards 

Malcolm

On Thu, Jun 4, 2009 at 10:01 AM, Herman <psytek@xxxxxxxx> wrote:

Brian, often people waste a lot of time trying to call something black or white; you learn more if you try looking at the grey stuff in between.

Of course there are 'systems' that last forever. Buy-n-hold, trend following, or rotational trading are trading systems to some. It all depends on your criteria of what makes a trading system. Then there are highly optimized trading systems that will, as one would expect, fade in and out of Performance. Some systems will, with some discretionary input, keep working forever while for a true mechanical trader these systems will fail. What may be a great trading idea to one person may be a joke to another. 

However, if you must have an answer I think it is best to err on the safe side and say that ALL systems will eventually fail. Overconfidence in any system may end up costing you dearly.

Best regards,

herman

Wednesday, June 3, 2009, 9:32:35 PM, you wrote:

> You are sitting on the fence Herman ... that can become a bit uncomfortable;-)

> In the scientific method all axioms are temporary and it only takes one

> verifiable case to reject the null hypothesis of the current axiom.

> We already have a list of candidate systems that people claim have remained successful over decades.

> Declare yourself ... do ALL systems fail because they are discovered and traded to failure or not?

> Are you are an evidenced based trader or some other kind of trader?

> Because breakout systems were made famous by the Turtles and they now fail

> for some traders does that mean all breakout systems fail for all traders and

> all instruments all of the time (how can anyone know the answer to that question one way or another?)

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