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You can't be serious Allaron and Robbins are THE Worst .
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> From: Neal T. Weintraub <thevindicator@xxxxxxxxxxx>
> To: Steven Buss <sbuss@xxxxxxxxxxx>
> Cc: omega-list@xxxxxxxxxx
> Subject: Re: Weintraub on Backtesting Questions
> Date: 29 July 1998 17:26
>
> Steven, I did not know that I had to prepare an academic report. this is
> merely my opinion from knowing hundreds of trading and lecturing around
the
> country for Omega and BMI. When I speak at Futures West, and Trading
> Technology seminar is New York I will be more accurate. Perhaps, you can
> give me a list of questions or should I ask them about their experiences
> with such brokerage firms like Allaron and Robbins that market systems
>
>
> -----Original Message-----
> From: Steven Buss <sbuss@xxxxxxxxxxx>
> To: Neal T. Weintraub <thevindicator@xxxxxxxxxxx>
> Cc: omega-list@xxxxxxxxxx <omega-list@xxxxxxxxxx>
> Date: Tuesday, July 28, 1998 9:12 AM
> Subject: Re: Weintraub on Backtesting Questions
>
>
> Comments inserted below.
>
> -----Original Message-----
> From: Neal T. Weintraub <thevindicator@xxxxxxxxxxx>
> To: Steven Buss <sbuss@xxxxxxxxxxx>
> Date: Tuesday, July 28, 1998 7:47 AM
> Subject: Re: Weintraub on Backtesting Questions
>
>
> >Steve
> >I will give Grant a call this evening and talk about this.
>
>
> I'd love to hear more about what Grant says about preparing seriously to
> trade the markets.
>
> >Back testing for futures is interesting and academic and may give you an
> >indication but that is about it. It is not the Holy Grail.
>
>
> An "indication" of what?
>
> So, your knowledge that backtesting provides interesting results that
> provide little value other than academic knowledge is based on what....?
> I'm looking for phrases like, "take a look at this book..." or "you know
S&C
> published this article not long ago..."
>
> I'd even settle for a "You know, I have access to a proprietary study
done
> by xyz trading company and they found...."
>
> No one on this list has used the word "Holy Grail" to describe the value
of
> backtesting that I know of so I don't know whose view you are arguing
> against here.
>
> >Back testing is like predicting the weather based on every July 29th for
> the
> >past twenty years.
>
> And, your knowledge that backtesting provides as little predictive value
of
> the worth of a trading system as a prediction of the "weather on every
July
> 29th for the past twenty years" is based on what?
>
> >I spent six months doing consulting for Omega. I was in every nook.
>
> And, the "six months doing consulting for Omega" and the fact that you
were
> "in every nook" (whatever that means) provided you with what specific
> information that has relevance to the issue of whether backtesting
provides
> value?
>
> > Let
> >Omega trade a system
>
> And, whether or not "Omega" could trade a system has what specific
relevance
> to the issue of whether backtesting provides value or not?
>
> > After all even Boeing tests its own aircraft.
>
> And, whether or not Boeing tests its own aircraft has what specific
> relevance to the issue of whether backtesting provides value or not?
>
> >the
> >market will do what ever it takes to fool the most number of people.
With
> >all these back testers why are most people net losers?
>
>
> So, what specific knowledge do you have about the relationship of the
number
> of folks who have done serious trading system backtesting to the number
of
> people who are net losers?
>
> >I know let,s back test that too!
>
>
> By positioning yourself as a kind of "expert" on the markets (I'd be
happy
> to expound on the ways that you've done that if you like) it seems to me
> that you'd want to substantiate the opinions that will appear in your
book
> and that you publish to the list or to its ftp site.
>
> IMO, the attempt at levity here does nothing to negate the fact that your
> note doesn't substantiate your view that backtesting provides little
value.
>
> I know that there are alot of folks who are members of this list
(including
> myself) who are sincerely and extremely interested in the backtesting
value
> question. If I may be so bold as to speak for some of these folks for a
> moment, we just want to know whether there is substance to your views on
> backtesting or whether you're just being chatty when you express them.
>
> Steven Buss
> Who only wishes he had more expertise in backtesting trading systems
>
> >-----Original Message-----
> >From: Steven Buss <sbuss@xxxxxxxxxxx>
> >To: Neal T. Weintraub <thevindicator@xxxxxxxxxxx>
> >Cc: Omega List <Omega-list@xxxxxxxxxx>
> >Date: Tuesday, July 28, 1998 5:10 AM
> >Subject: Weintraub on Backtesting Questions
> >
> >
> >Neil,
> >
> >I'm trying to figure out what it is that you're saying about
backtesting.
> >In your interview with Grant Noble, he says on p. 6.
> >
> >"...You can have a good system but you don't trust it enough to follow
> every
> >signal. To get a system, you can trust and use, you must know its
> parameters
> >and strengths/weaknesses. In other words, you never are going to
purchase a
> >"system" whose results year and year out are better than the average
trend
> >following system. So you might as well design your own and stop
frustrating
> >yourself."
> >
> >And then you say:
> >
> >"Well, the people advertising trading systems won't like to hear this.
And
> >neither will people promoting back testing software packages."
> >
> >Question:
> >
> >What SPECIFICALLY is it that you believe Grant Noble said that back
testing
> >software package vendors won't want to hear? I would think that it is
> >precisely system backtesting that would help to secure Mr. Noble's
> suggested
> >goal of "knowing...[a system's]...parameters and strengths/weakneses."
I
> >don't see anything that he said that would justify the last statement
that
> >you made. Your statement could imply that you believe software that may
be
> >used for backtesting, like TS, is no more valuable than some "trading
> >system" software that can be purchased. Is this what you mean to imply?
> Do
> >you believe that backtesting a trading system doesn't provide value?
> >
> >On the following page the exchange goes like this:
> >
> >Grant: "The best advice is to read everything you can and practice
before
> >you trade real money. "It's amazing how people will spend years of study
> and
> >thousands of dollars to become a lawyer or a doctor, but somehow they
think
> >they can enter the high income profession of futures trader without
doing a
> >bit or preparation…Again and again I have seen public traders lose tens
of
> >thousands of dollars and be none the wiser after all their time and
money.
> >They should have put that lost 10,000 into buying every futures book
they
> >could find. All that time watching prices could have poured into a
> >self-directed 'college course' learning about the market. "(Pg.46, "The
> >Traders Edge"). Nothing is going to work until you have confidence it
is
> >going to work and that takes time."
> >Neil: "So buying a piece of software won't cut it."
> >Grant: "Right."
> >
> >Now again, your position, and Mr. Noble's, vis-a-vis trading system
> >backtesting is unclear. I would think that backtesting is a terrific
means
> >of securing the objective Mr. Noble advocates of having confidence in a
> >trading system. But Mr. Noble just advocates "practice." Does
"practice"
> >mean "paper trading"? I'm not clear that it could mean anything else
> >because when you state that buying software won't help (including
> >backtesting software like TS) Mr. Noble says "Right."
> >
> >I believe that if you explained your views on system backtesting clearly
> and
> >in detail to the list you'd get alot of feedback, which is, I assume,
your
> >purpose in posting the interview to the Omega list FTP site.
> >
> >If, in fact, you don't believe backtesting a system, using software like
> TS,
> >provides value, it would be helpful if you could point to your own
> >experience with backtesting systems that led you to such a view or to
other
> >materials upon which your view is based.
> >
> >Steven Buss
> >Walnut Creek, CA
> >sbuss@xxxxxxxxxxx
> >"There's nothing more practical than good theory."
> >
> >
>
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