Re: Price shocks and money management

["The Omega Man" <editorial@xxxxxxxxxxxxx>]

Let's start by defining terms.  Is everyone willing to accept the
definitions posted by Jake Bernstein at:

http://www.trade-futures.com/TTSystem.html  ?


I believe these definitions are correct and that they imply that system
trading is "mechanical" and leaves no room for interpretations that might
vary between two individuals looking at the same chart.  If two individuals
could look at the same chart and, following the "system rules", arrive at
different conclusions, then we are not talking about a system by my
definition (or by Jake's, or Robert's).


The problem with allowing selective decision making when implementing a
"system", the problem with turning the controls back to the "pilot" when
flying through the tornado, is that it eliminates the three major benefits
of automation:

(1)  Elimination of the effects of emotion
(2)  Consistency of application
(3)  Mechanical risk control


If the trader is allowed to override system signals at any time then the
above 3 benefits of system trading are lost.





----- Original Message -----
From: Robert W Cummings <robert.cummings@xxxxxxxxxxxxxxxx>
To: Bob Fulks <bfulks@xxxxxxxxxxxx>
Cc: Omega List <omega-list@xxxxxxxxxx>
Sent: Sunday, July 25, 1999 4:33 PM
Subject: Re: Price shocks and money management


> At 02:19 PM 7/25/1999 -0400, Bob Fulks wrote:
> >I hesitate to prolong this discussion but I hate to see some of these
> opinions go unchallenged.
> >
> >I trading system is just a computer program. It does what the code tells
> it to do. If the code handles every situation that will ever occur, then
> perhaps you could turn it on and let it trade "untouched by human hands".
>
>
> Yes that's what it means to me Bob I don't disagree with rest of your post
> either. If your going to use your discretion along with the system then
how
> can you use the term system trading. If you gave your system to the world
> you would need to write a book of rules to go with it. If you have to
write
> a rule and can't program it then I still say respectfully you don't have a
> system.
>
> Robert
>