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<DIV><FONT color=#000000>I have been reading with amusement the various posts
warning people away from George Heffernan's Accutrader. The amusing parts
are the speculation that one cannot trade the S&P with 1 point stops and
strive to make profits in the 1 and 2 point range. The part about
not being able to have 80%+ returns </FONT></DIV>
<DIV><FONT color=#000000>was also pretty good. While I, like the
people criticizing Accutrader, have not traded the system, I do know that the
claims are feasible. I day trade the S&P using 2 minute charts (
accutrader uses 3 or 5 minute charts ) so it is definitely possible to trade
that short of a time frame. My accuracy while not 85%, is currently 79.6%
which is not far removed, I am sure there are some cynics that would tell
people 79% is not possible. Lastly I never risk more that 1 1/2
points on a trade, and more often than not, risk only 1 point per trade. I
have been consistently profitable since I began trading this method, which is a
mechanical, momentum based system that uses simple off-the-shelf indicators and
one price pattern. Also if you ask me what my slippage is I will tell you
it is zero...the reason is, I am scalping to pick up profits between 1 and
2 points. My target which uses a limit order ( no slippage with those ) is
always between 1 and 2 points from where I enter the market ( not from where my
entry stop is ), My commissions are $20.oo per round turn. Please
don't buy into the notion the trades must be docked $200 or even $100 when
looking at a track record, that can be drastically affected by the type of order
used as well as where the order is placed. I suspect the idea of $100-$200
slippage originated from some classic trading techniques that would have you
place an order in the same area where hundreds of other orders are
placed.</FONT></DIV>
<DIV><FONT color=#000000></FONT> </DIV>
<DIV><FONT color=#000000>Also please don't begrudge someone for selling their
system as there are some good reasons for doing so. It could be the trader
has developed a decent system, but has no capital or is under capitalized ( I
did call George Heffernan about his system and this is the reason he gave for
selling it. ) Another good reason for selling a system is that it is not
compatible with your personality. I can attest that day trading is much
more stressful than position trading ( for me anyway ). So if a position
trader develops a good day trading system, trys it for a while but finds it too
stressful, he may decide to sell it and return to position trading. This
doesn't mean that the system was not good or did not make money, it simply means
that it was not a good fit for that particular trader...it could be a marriage
made in heaven for someone else. I am a good example of this, as I
have been position trading for many years, but have been interested in
diversifying over multiple time frames so developed the daytrading methodology I
am currently using. While it is proving to be very profitable it is also
proving to be a very intense form of trading and more stressful than I
anticipated...in other words, while I continue to trade it, I am not yet
convinced that it is a good match for my personality ( I am currently hoping my
personality will adjust somewhat, given time ). Trading, aside from being
profitable, must also be done in a way that is enjoyable. Life is too
short to have it any other way.</FONT></DIV>
<DIV><FONT color=#000000></FONT> </DIV>
<DIV>It is relatively easy to develop a profitable system. It is much
harder to implement that system in real trading due to our human emotions of
fear and greed ( But where would the markets be without fear and greed?).</DIV>
<DIV>There are some very good system developers in the world such as Tom DeMark,
who do not trade because they do not have the disposition for it, but instead
opt to sell their services to others. DeMark for example, was on Tudor
Jones' payroll for several years. Here is an example of a great trader,
Jones, buying systems from a developer, DeMark.</DIV>
<DIV><FONT color=#000000></FONT> </DIV>
<DIV><FONT color=#000000>Lastly, do not assume that because someone is
profitable in a daytrading or scalping environment that they would automatically
be profitable in a money management or hedge fund environment. I know that
my own system, while very profitable trading small lots ( 5 contracts is
probably the upper limit ), is simply not a feasible approach when trading
larger lots. The result would simply be partially filled orders, which
would quickly erode profits down to zero. To trade hundreds of millions or
often even millions of dollars takes a much longer term approach than Mr.
heffernan's system provides. So even if it is as profitable as he
claims ( and it could be ), there is a good reason he is not snatched up
by a hedge fund and made a super star trader...his system simply is
inappropriate for that scale of trading and would not work. This is
analogous to saying that a profitable floor trader could be placed in an
off-floor environment and still be profitable using his old floor trading
methods. He wouldn't be, he would have to adopt new methods or go
broke.</FONT></DIV>
<DIV><FONT color=#000000></FONT> </DIV>
<DIV><FONT color=#000000>In closing, let me urge you not to be cynical about
good claims. Certainly there are charlatans and cheats around, just as in
any business, you often have to sift through the crap to find the nuggets.
In accutraders case, a written money back guarantee is offered. Also when
ordering trading books,systems, etc, just use a credit card and you can always
have the charge revoked ( I have done this on one occasion ).</FONT></DIV>
<DIV>Also with regards to cynicism, remember there are plenty of
"respectable" financial advisor types that when asked about someone
making money in futures ( say Richard Dennis, Tudor Jones, or Linda Raschke )
will tell the questioner ( with a bit of a haughty laugh ) that it is simply not
possible, that " if it sounds to good to be true it probably
is." As a result, their client walks away from what might have
been a very rewarding and profitable pursuit..</DIV>
<DIV> </DIV>
<DIV>All the Best !</DIV>
<DIV>Bill Shumake</DIV></BODY></HTML>
</x-html>From ???@??? Sat Jan 09 13:36:26 1999
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Date: Sat, 09 Jan 1999 13:37:31 -0600
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From: michael willkie <willkie@xxxxxxxxxxx>
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Subject: TRADING
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Hello, I have a question about the PMB system you use to fill your
orders. I assume you are talking about market orders on the SP and I
wonder if the conformation you see is the actual fill or notice that
they have the order on the floor? Thanks for the imformation.
DAN WILLKIE
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