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Jim,
Everything you state is basically correct. CFTC is also accusing Greg Regan
of acting as a CTA. IMO, he has simply authored some excellent software,
and he refuses to optimize or change it from its original form, although
some traders claim to have made changes to some of the systems that make
them perform better recently. I have found, as many of you have experienced
also, that slippage works both ways, and pretty much evens out. Many of
their clients, including me, are planning to provide testimony in R&W's
behalf. And yes, no 1st day stops in the Spoo can be nerve-racking, but
it's not as dangerous since they halved the contract.
Drawdown can be a serious problem, but if one is a methodical position
trader, it must be accepted as a business expense(although very frustrating
to a customer who buys the system at the beginning of a draw-down period).
Steve
----------
> From: HamerJP <HamerJP@xxxxxxx>
> To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
> Subject: Re: Mechanical Trading
> Date: Wednesday, January 21, 1998 10:30 PM
>
> In a message dated 98-01-19 07:24:44 EST, Steve Schnake writes:
>
> << I too bought the $16,500 system that Jonn trades, back in 1996.<SNIP>
>
>
> I assume you guys bought the R&W system. I heard they got nailed for
about 6
> or 7 million in fines from the CFTC (I think with the way they marketed
it or
> the way they worded the hypothetical returns).
>
> But I talked with some brokers who are trading it and they said it has
had a
> great year - but not without a pretty large drawdown earlier.
>
> I like the way it hangs with a position (I heard it's been short the
> currencies for a while), but I don't like the way it doesn't place a stop
on
> the S&P the first day (if I understand it correctly). Other than that it
> sounds like a good system.
>
> I hope it continues to make money for you guys.
>
> Good luck,
> Jim Hamer
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