Can a successful system be reverse engineered? | Forex Factory

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Can a successful system be reverse engineered?

  • #1
  • First Post: Jul 27, 2017 10:21am Jul 27, 2017 10:21am
Reading few of the posts why most successful traders don't share their Trade explorers or make a Myfxbook monitoring is because they are scared their system might get reverse engineered.
Is it really possible to reverse engineer a system or its just the paranoia or anxiety?
  • #2
  • Jul 27, 2017 11:05am Jul 27, 2017 11:05am
it cannot be engineered but can be followed without any benefit for the trader. there are other more important reasons - first of all there are very few successful traders. i do not count traders that are exploding with pocket money or traders that have amazing results for few days/weeks or even for a few months. about the real pro traders - their results are long-term, they have ups and downs that are not going to be understood by the masses. People want to see steep growing equity curves so they can dream about becoming millionaires in few months or a few years, the marketing of forex industry wants exactly that. Truth is such miracles mostly don't happen. Also, top traders are way over the stage where they go those sites and connect trade explorers to prove what? nothing.. would you link your bank accounts live to a public forum just so other people get inspired/conviced/respected/amazed or whatever by the money that you have/make? Same goes for myfxbook, although i find it useful for just a few purposes. The only reason I see a pro trader to connect an account is to show potential investors, but there are also other options to do it. Serious investors are not going to trust myfxbook so we can say it is for showing off mostly. Stats are not hard to manipulate. So most top systems are some sort of scams or temporary luck. I have found over the years that if something looks too good to be true in trading, then it is too good to be true The road to success goes off the forums and far away from the trade explorers.
  • #3
  • Jul 27, 2017 12:25pm Jul 27, 2017 12:25pm
What advantage would anyone successful having in sharing the account and trades here? The only would be to drum up more capital from investors, or to show off.

I see no reason to show my live results to anyone, I have neither the arrogance, sense of self-importance, or do I want the work involved in dealing with people copying or asking a million questions or people losing money based on something I did.
  • #4
  • Jul 27, 2017 1:22pm Jul 27, 2017 1:22pm
Quoting solecrusader
Reading few of the posts why most successful traders don't share their Trade explorers or make a Myfxbook monitoring is because they are scared their system might get reverse engineered. Is it really possible to reverse engineer a system or its just the paranoia or anxiety?
Who the hell knows, no one can give you a guarantee for sure, so if you have an real edge: hide it...Everything else is stupid
"Men Who Can Both Be Right & Sit Tight Are Uncommon" ~ Jesse Livermore
  • #5
  • Jul 27, 2017 2:25pm Jul 27, 2017 2:25pm
You cannot reverse-engineer skill and experience.
When you've reached a very high trading-level, there is absolute no benefit to give free rides.
You don't need anyone looking over your shoulder.
Making money for yourself is the only thing that counts.
  • #6
  • Jul 27, 2017 4:34pm Jul 27, 2017 4:34pm
Honestly, you can't reverse someone's strategy entirely. You can try, but then you would have to then also reverse engineer their personality, discipline, etc. along with it. No two people trade exactly the same. There was a saying that goes "Give 10 traders a strategy and you will have 10 different track records."
  • #7
  • Edited 8:34pm Jul 27, 2017 8:09pm | Edited 8:34pm
Quoting solecrusader
Reading few of the posts why most successful traders don't share their Trade explorers or make a Myfxbook monitoring is because they are scared their system might get reverse engineered. Is it really possible to reverse engineer a system or its just the paranoia or anxiety?
Yes it is possible. In the systematic trend following space there is now a whole class of reverse engineered systems that seek to emulate the performance of the long term successful CTA's who are heavy on intense R&D and protect their strategies with vigor. These guys are referred to in the industry as the CTA replicators. There currently is a hostile battle going on in the industry where the CTA replicators are offering their services at lower fees than the traditional 2:20 guys.

Have a look at this post as it demonstrates how Andreas Clenow can achieve very comparable long term performance metrics to the successful CTA's using reverse engineering of models that are hidden under the shroud of secrecy. His abilities to manage drawdown profiles is a very impressive skill. If only we were all that capable :-)
  • #8
  • Edited 9:41pm Jul 27, 2017 8:39pm | Edited 9:41pm
It is not difficult to reverse engineer a system if there is a time and price field because nearly every indicator is written against a moving average.
You cannot be extraordinary by being normal
  • #9
  • Jul 27, 2017 8:55pm Jul 27, 2017 8:55pm
Quoting dkrock
As for sharing account information...LOL...are you kidding me???? Unless you are a publicly traded company, then "account" information is YOUR money! Do you walk around giving people information about your bank account? The checker at the grocery store? The guy with the nice car? The lady who looks nice? LOL. But, you let jackoffs in FF convince you they need to know?? WOW!!
It's not the money or missed opportunity that's important. It is the warm feeling you get when you help other colleagues out....of course it could also be because you are a friggin' retard....like me who can't keep his mouth shut.

I prefer the former alternative.

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  • #10
  • Jul 27, 2017 9:10pm Jul 27, 2017 9:10pm
Quoting Copernicus
{quote} It's not the money or missed opportunity that's important. It is the warm feeling you get when you help other colleagues out....of course it could also be because you are a friggin' retard....like me who can't keep his mouth shut. I prefer the former alternative. {image}
Helping a person organize their thoughts to design a plan is one thing. Handing over the keys to your gold mine to a worldwide audience is an entirely different matter.
You cannot be extraordinary by being normal
  • #11
  • Jul 28, 2017 2:10am Jul 28, 2017 2:10am
Copernicus seemed to nail it... A system can be reverse engineered... The questions about anxiety and paranoia are interesting. When someone reverse engineers a system does it also mean they can destroy it? Can they change the rules of trading so that you will no longer be profitable?

Quoting michisuperfr
{quote} Who the hell knows, no one can give you a guarantee for sure, so if you have an real edge: hide it...Everything else is stupid
Why hide your edge exactly? Check out turtle traders... They have a system, it is open and available, and profitable. There is nothing to hide.
http://www.bigpicture.typepad.com/co...urtlerules.pdf

Read the section where Richard Dennis (the founder of the turtle traders) says, "I always say that you could publish my trading rules in the newspaper and no one would follow them. The key is consistency and discipline. Almost anybody can make up a list of rules that are 80% as good as what we taught our people. What they couldn't do is give them confidence to stick to those rules even when things are going bad." - From Market Wizards, by Jack D. Schwager.
  • #12
  • Edited 3:45am Jul 28, 2017 3:31am | Edited 3:45am
Quoting nummularius
Copernicus seemed to nail it... A system can be reverse engineered... The questions about anxiety and paranoia are interesting. When someone reverse engineers a system does it also mean they can destroy it? Can they change the rules of trading so that you will no longer be profitable? {quote} Why hide your edge exactly? Check out turtle traders... They have a system, it is open and available, and profitable. There is nothing to hide. http://www.bigpicture.typepad.com/co...urtlerules.pdf Read the section where Richard Dennis...
It's enough that someone codes it correctly into an algo and sells it/start a signal service/copy trading whatever...

I think then it would be only a question of time till it would stop working (zero sum game)...

And like Flipper said, making money for yourself is the only thing that counts, one would gain absolutely nothing revealing his system to the public.
"Men Who Can Both Be Right & Sit Tight Are Uncommon" ~ Jesse Livermore
  • #13
  • Jul 28, 2017 4:41am Jul 28, 2017 4:41am
Quoting solecrusader
Reading few of the posts why most successful traders don't share their Trade explorers or make a Myfxbook monitoring is because they are scared their system might get reverse engineered. Is it really possible to reverse engineer a system or its just the paranoia or anxiety?
The more discretionary the strategy, the more difficult it would be to reverse engineer from a performance graph. A strategy that involved complex PA, 'external' conditions like strength/weakness analysis, FA, intermarket correlations, institutional techniques, etc etc would be near impossible.

But perhaps I'm merely stating the obvious.
  • #14
  • Jul 28, 2017 4:49am Jul 28, 2017 4:49am
Quoting hanover
{quote} The more discretionary the strategy, the more difficult it would be to reverse engineer from a performance graph. A strategy that involved complex PA, 'external' conditions like strength/weakness analysis, FA, intermarket correlations, institutional techniques, etc etc would be near impossible. But perhaps I'm merely stating the obvious.
From the performance graph it should be for sure impossible!? But what if one has the database of all trades with all entry and exit details?
Because I don't know, but if I would own Myfxbook and someone would upload there an outperforming system (Which is consistent over 2+ years or something like that) I would definitely take a closer look what he's doing
"Men Who Can Both Be Right & Sit Tight Are Uncommon" ~ Jesse Livermore
  • #15
  • Last Post: Jul 28, 2017 9:01am Jul 28, 2017 9:01am
you want profitable system = you want a drug that makes you feel supreb. then you have a trade explorer of a system that makes money, its like seeing the effect on that superdrug on some person. So, are you going to be able to reverse engineer the exact chemical formula just by seeing what it can do on someone?
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