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Alfredo:
Interesting post and interesting conclusions.
It's my opinion that experienced traders here, both systems traders and
discretionery traders, have traveled the path of buying other people's
techniques and systems. In general, this path will wind around and around the
mountain of doom until you take responsibility of your own thoughts and actions.
Systems, like trading techniques, are tools to be used. They are not the door to
riches.
A good trader looks at any new tool with skepticism. I'll quote Mark Brown from
a post this morning, since it fits in perfectly with this answer:
> I will also comment you only find these things out when you are
> actually using the program to trade and you have money riding on the
> software, then and only then does every little detail about the software
> matter so much to you. MB
If you buy a book because you believe the hype that this one book will be the
key to your trading success, you will be disappointed. If you buy a system
because you thought you would be able 'to follow it blindly for about three
years,' you will be disappointed and probably have stopped trading long before
the three years are up. Following anything blindly will generally lead to ruin.
However, if you purchase a book about trading and read it with a discerning eye,
you may learn a few interesting techniques that you can add to your trading tool
arsenal. And if you buy a system and look deep into its nooks and crannies and
study it while you paper trade it, you may learn much about the system, both
good and bad, and about yourself [again, both good and bad]. You might even find
a system that suits your personality, your trade tolerance and your
expectations. But you will only know these things after you look at this
system's bumps and warts. I would not characterize this as 'following a system
blindly.'
You conclude that:
> It seems that you experienced traders don't believe in
> buying trading systems. It also seems that either you don't have a
> good trading system or you will not share it.
I don't reach that conclusion after reading the posts that were made in response
to your original query. A list like this gets naive posts like your original
post at least once a month and to the traders that have been here discussing the
minutiae of trading successfully, these posts are generally taken as an insult
to the traders that sweat and toil learning how to trade their techniques and/or
their systems. I would hazard that some of the scorn you felt in reply to your
original post also comes from the memories of the systems and indicators and
books we all bought in a weak moment, with the hope that we would indeed find
the BIG answer to solve our trading woes, only to find that they were the same
tired tricks of the trade recycled once again.
There are traders here that certainly do feel there are good trading systems. In
fact, quite a few of them trade good trading systems. I doubt they trade them
'blindly,' however. They take the signals and execute the signals, but they also
look at the performance and do continuing research on how to improve the system,
because for the most part, the successful systems were built by the people that
trade them.
And last, you ask:
> Aren't you guys validating the random-walk hypothesis? Why are
> you still in this business?
I assure you the serious traders here do not believe the market follows a random
walk. Many of us make a very good living trading. Certainly practicing money
management is a good part of our success, but I personally see patterns and
rhythms repeated over and over in the markets. The markets that I trade are
certainly not random. And I am in business because trading is what I do and it's
what I love to do. It pays for food, clothing, my cars, the wants of my wife and
our soon-to-be-born son.
I hope this answers some of your questions. I also hope you can now make a
better characterization of the serious traders that discuss trading on this
list.
Best,
Tim Morge
Alfredo Simas wrote:
>
> Hi,
>
> I would like to kind of summarize for you the replies I got to my
> question concerning the purchase of a Trading System:
>
> I received many messages saying that such a system does not
> exist.
>
> Some replies were in the line of "Why not give your money to
> charity so you will at least do something worthwhile." Others were
> like that: "Are you serious? Don't think such a thing exist, or the
> developer would ever sell it, and if there is, he's too busy living it up
> in the Bahamas." or "Of course, if any of us had this system, we'd
> be very happy [I am guessing MB would buy Omega and turn it into
> a charity for destitute newbie traders] and very rich."
>
> Others just told me to take my time and do my homework.
>
> These comments were all very enlightening and highly educational
> to me. It seems that you experienced traders don't believe in
> buying trading systems. It also seems that either you don't have a
> good trading system or you will not share it.
>
> Ralph Vince in his book "Portfolio Management Formulas" wrote a
> completely different assertion:
>
> "If, like so many people, you do not believe you can find a decent
> system for sale, you are sadly mistaken. True, most systems that
> are for sale are junk, yet some are very good, and some are terrific".
> and he completes: "systems, like market ideas, are 99.73% junk".
>
> My question to all of you is:
> Aren't you guys validating the random-walk hypothesis? Why are
> you still in this business?
>
> Any comments will be gladly appretiated.
>
> Alfredo
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