Trading systems - Never pay for one! | Forex Factory

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Trading systems - Never pay for one!

  • #1
  • First Post: Oct 20, 2015 4:38am Oct 20, 2015 4:38am
Not really a thread, more a wee bit of advice from someone who's been a trader for a number of years. NEVER pay for a trading system. Without exception anyone selling one is either a charlatan, or a bonafide trader who wants to make a bit of easy cash but who will never give the system they use away, only a modified, simplified version of it. If you want to make a start with a simple chart set up, then scroll through the systems threads here on ff, find something online, or perhaps get a book, there are some good ones detailing simple strategies.

One point to stress though - no system on its own will turn you overnight into a successful trader. Any system has to evolve with a trader, through tinkering and trial and error. You have to learn what's going on around the system concerning price action, where the S&R levels come in etc - there is much to learn, which seems obvious, but most people come into trading fail to appreciate just how much to learn there is. A good, simple strategy can get you off to a good start, but it will only be a start - the rest will depend on you. But whatever you do, DO NOT PAY ANYONE ANY MONEY FOR A SYSTEM!!
  • #2
  • Oct 20, 2015 6:32am Oct 20, 2015 6:32am
Just recently re-quoted a bit differently though in the movie American sniper. It applies to humans in general and not just war.

There are three types of people in this world: sheep, wolves, and sheepdogs.

Well we know in the trading/investing world, there's an endless supply of Sheep desperate for the almighty dollar.

This abundance of Sheep brings the Wolves/predators. They're waiting patiently on the sidelines for the kill.

Then there's the Sheepdogs. These are the people compelled to protect the Sheep from the Wolves.

Member Mingary for one is by far the top FF Sheepdog and many just don't get it.

Cat, you sound like a Sheepdog. You may have to change your name. (-:

Have a great day...

Side note: I read somewhere that the original published quote was by Lieutenant Colonel David Grossman from his book On Combat, published in 2004. Not quite sure if this is fact.


Quoting cat
Not really a thread, more a wee bit of advice from someone who's been a trader for a number of years. NEVER pay for a trading system. Without exception anyone selling one is either a charlatan, or a bonafide trader who wants to make a bit of easy cash but who will never give the system they use away, only a modified, simplified version of it. If you want to make a start with a simple chart set up, then scroll through the systems threads here on ff, find something online, or perhaps get a book, there are some good ones detailing simple strategies....
SPC * Swollen PocketZ Crew!
  • #3
  • Oct 20, 2015 6:47am Oct 20, 2015 6:47am
Quoting cat
Not really a thread, more a wee bit of advice from someone who's been a trader for a number of years. NEVER pay for a trading system. Without exception anyone selling one is either a charlatan, or a bonafide trader who wants to make a bit of easy cash but who will never give the system they use away, only a modified, simplified version of it. If you want to make a start with a simple chart set up, then scroll through the systems threads here on ff, find something online, or perhaps get a book, there are some good ones detailing simple strategies....
Couldn't agree more. Selling a profitable system is just nonsensical. If you really want to help others then do it for free.
  • #4
  • Oct 20, 2015 6:50am Oct 20, 2015 6:50am
Quoting JoeNY
Just recently re-quoted a bit differently though in the movie American sniper. It applies to humans in general and not just war. There are three types of people in this world: sheep, wolves, and sheepdogs. Well we know in the trading/investing world, there's an endless supply of Sheep desperate for the almighty dollar. This abundance of Sheep brings the Wolves/predators. They're waiting patiently on the sidelines for the kill. Then there's the Sheepdogs. These are the people compelled to protect the Sheep from the Wolves. Member Mingary for one...
True. Mingary, he's one of the 14 people on my ignore list, and I don't ignore people lightly. I wouldn't put myself in the sheepdog category, I'm too busy with my own life for that, I'm more like a sheep who learned how to stay alive and who is now throwing a bit of experience out there for whoever may want to heed it.
  • #5
  • Oct 20, 2015 7:17am Oct 20, 2015 7:17am
Quoting timestamp
Selling a profitable system is just nonsensical.

I agree, even to the extent that if you see one advertised, it can't be profitable, because it wouldn't be for sale in that way, if it were.

Many are marketed by people without the necessary skill-set even to determine whether or not they're genuinely profitable, and even more by people who have deliberately backfitted them to appear to be profitable, knowing that in this "desperate buyers' market" there are many naive and gullible potential customers who won't appreciate the reasons for the absolute lack of correlation between something having made a profit over the previous year and its probability of making a profit over the next year.

That's "profitable systems", though - not necessarily 100% of "profitable education", which is something altogether different.

In the late 1990's, a group of American academics (mathematicians, physicists, engineers, computer scientists, economists and others) got together and developed a profitable trading system more or less reduceable - in expert hands - to software, which they then successfully leased to Credit Suisse for a large six-figure monthly sum and a percentage of its profits. Major trading institutions pay people large salaries to assess such "profitable systems" and have close-to-infinite funding available for their acquisition and development. Genuinely "profitable systems" are marketed that way, not by being advertised to retail traders on ClickBank for $297, or even as a course for $4,997.
  • #6
  • Oct 20, 2015 7:41am Oct 20, 2015 7:41am
Quoting timestamp
Selling a profitable system is just nonsensical.
Quoting Xela
{quote} I agree, even to the extent that if you see one advertised, it can't be profitable, because it wouldn't be for sale in that way, if it were.
Selling a profitable system is indeed nonsensical because there is no demand for it. Nobody would give you a cent.
  • #7
  • Oct 20, 2015 8:37am Oct 20, 2015 8:37am
Quoting Atokys
{quote} {quote} Selling a profitable system is indeed nonsensical because there is no demand for it. Nobody would give you a cent.
That's where you are wrong, people buy trading systems all the time - if they didn't, no one would bother selling them. The fact that they do means there's a market for them. Any system for sale is of course sold as highly profitable, which doesn't mean it is or it isn't. In the right hands it could be, but then anyone who knows how to trade won't be buying a system. It's the trap people fall into, because if I sold my system, or a variation of it, I wouldn't be lying by telling people it was profitable, but I would be misleading people by telling them that provided they follow it step by step they will make money. If trading was that easy, we'd all be millionaires, or rather, there would be no money left in the trading pot for anyone to win.
  • #8
  • Oct 20, 2015 8:39am Oct 20, 2015 8:39am
Quoting cat
{quote} That's where you are wrong, people buy trading systems all the time - if they didn't, no one would bother selling them. The fact that they do means there's a market for them.
But they don't buy profitable systems. People seem to only desire unprofitable ones.

And thats probably why theres such a big market for lousy systems.
  • #9
  • Oct 20, 2015 8:47am Oct 20, 2015 8:47am
You will pay for your education one way or another in the markets !!!
It never gets easier, you just get better
  • #10
  • Oct 20, 2015 8:52am Oct 20, 2015 8:52am
Quoting Xela
{quote} reasons for the absolute lack of correlation between something having made a profit over the previous year and its probability of making a profit over the next year..
I've found that once you have a tried and tested system, apart from a bit of tinkering to adjust to market conditions which fluctuate, this system will be good for life. The reason is that the markets are driven by human nature, and this over time never changes. I have used my system for five years in exactly the same way, and have never had to change it due to any fundamental change in market conditions, except when there is exceptionally high volatility, which requires bigger stop losses etc. The parameters remain the same.
  • #11
  • Oct 20, 2015 9:01am Oct 20, 2015 9:01am
Quoting Atokys
{quote} But they don't buy profitable systems. People seem to only desire unprofitable ones. And thats probably why theres such a big market for lousy systems.
haha Yes it seems so, but of course people just buy systems, which they believe will be profitable, and they may look fantastic when backtested, but if you are new to trading you may as well let your pet monkey use it for the good it's going to do you. Which is why no one should ever pay for one, because there is no such thing as a profitable system, only profitable traders using their own methodologies, none of which were ever bought.
  • #12
  • Oct 20, 2015 9:20am Oct 20, 2015 9:20am
Quoting cat
{quote} haha Yes it seems so, but of course people just buy systems, which they believe will be profitable, and they may look fantastic when backtested, but if you are new to trading you may as well let your pet monkey use it for the good it's going to do you. Which is why no one should ever pay for one, because there is no such thing as a profitable system, only profitable traders using their own methodologies, none of which were ever bought.
People purchase trading courses/systems/education in an attempt to solve their feelings about uncertainty. This approach never leads to success because such people fundamentally misunderstand what trading is about.
  • #13
  • Oct 20, 2015 9:55am Oct 20, 2015 9:55am
Quoting cat
I've found that once you have a tried and tested system, apart from a bit of tinkering to adjust to market conditions which fluctuate, this system will be good for life. The reason is that the markets are driven by human nature, and this over time never changes. I have used my system for five years in exactly the same way, and have never had to change it due to any fundamental change in market conditions, except when there is exceptionally high volatility, which requires bigger stop losses etc. The parameters remain the same.

Real systems, yes ... (the same is true of mine, so far).

But it's very easy to cobble together from previous price data a system which works only on that specific data. And that's a substantial proportion of the stuff that people are selling. It was specifically designed to be profitable from "backtesting" (it's actually "backfitting" because the system is designed from the previous data, but they call it "backtesting", to sell it) and won't work on forward-testing. This is one of the points that many buyers of "backtested EA's" and the like don't appreciate.
  • #14
  • Oct 20, 2015 10:27am Oct 20, 2015 10:27am
Quoting Xela
{quote} Real systems, yes ... (the same is true of mine, so far). But it's very easy to cobble together from previous price data a system which works only on that specific data. And that's a substantial proportion of the stuff that people are selling. It was specifically designed to be profitable from "backtesting" (it's actually "backfitting" because the system is designed from the previous data, but they call it "backtesting", to sell it) and won't work on forward-testing. This is one of the points that many buyers of "backtested EA's" and the...
Well yes, that is all that can be sold of course, unless a seller is willing to demonstrate a system live via webinar, and I've never heard of that. Personally, I deveolped my own system by first backtesting different variables before trying them out on a demo account, and through trial and error, over quite a few years in my spare time, slowly developing something that I understood and which worked. Problem is, most people expect a system to just work, they'll pay for it or get it from somewhere, and because they inevitably lose money, they'll blame the system rather than their own incompetence. People have come on ff claiming that it's impossible to be a successful trader and that it's impossible to make money from something as random as the market. I was even told this to my face by professional investors before I became a full time trader. It is definitely one of the least understood professions in the world.
  • #15
  • Oct 20, 2015 11:10am Oct 20, 2015 11:10am
I believe there are 2 fundamental problems with copying a trading system.

1. you have to write your system down, very precisely leaving nothing open for interpretation. I tried to teach my system to a few people: I failed, I'm a very profitable trader but I'm a bad teacher.
2. as soon as your system is not 100% mechanical there is a (potentially big) psychological component.

People buy unprofitable systems because they're asking for something the market can't deliver (100% mechanic copy & paste, nothing open for interpretation - honestly: if that would work, why on earth did I get up this morning to trade manually?).
  • #16
  • Oct 20, 2015 12:34pm Oct 20, 2015 12:34pm
Trading another persons system won't work.. You can get idea's from other people.. but must make it your own system.
As unique individuals we all see the market different.. and can tolerate different lengths of trades, different risk management, different timeframes, different methods of entering and exiting. Some of us can handle a 100 pip drawdown, while other people will freak out.
So if you pay for a system.. its 99% sure not to be profitable..
Must find a style that works for you, Then create your own rules.. And have it fit your personality.
The only system that will work is one designed by and for yourself.
  • #17
  • Oct 20, 2015 8:53pm Oct 20, 2015 8:53pm
Quoting cat
Not really a thread, more a wee bit of advice from someone who's been a trader for a number of years. NEVER pay for a trading system. Without exception anyone selling one is either a charlatan, or a bonafide trader who wants to make a bit of easy cash but who will never give the system they use away, only a modified, simplified version of it. If you want to make a start with a simple chart set up, then scroll through the systems threads here on ff, find something online, or perhaps get a book, there are some good ones detailing simple strategies....
Can't really add anything except ....
Ghost Rider - WWTBMD?
  • #18
  • Oct 20, 2015 9:13pm Oct 20, 2015 9:13pm
what are your thoughts on account managing traders where they take a cut of your winnings? Not sure what they do if they burn your account or what you can do besides looking very sheepish?


Sheepish..
See what i did there?
None the wiser!
  • #19
  • Oct 21, 2015 1:21am Oct 21, 2015 1:21am
Quoting FxClown
what are your thoughts on account managing traders where they take a cut of your winnings? Not sure what they do if they burn your account or what you can do besides looking very sheepish? Sheepish.. See what i did there?
I did. I'm not sure what I think about it, but I guess as long as they are making you money, then I'm all for it
  • #20
  • Last Post: Oct 21, 2015 2:25am Oct 21, 2015 2:25am
Quoting JensG
2. as soon as your system is not 100% mechanical there is a (potentially big) psychological component.
This is the bit many don't understand.
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