i believe most of them are crap. if they actually believed in their system they wo

[TRADINGXYZ]

mean reversion, you don't have to play max positions when trying something out...play smaller positions, or take a free trial if its offered... to help build confidence...All systems will have drawdown... you just have to have faith that they will recover...you do this by looking at their historical results and using proper money management when the system is in drawdown...

also, what makes you think that if you knew more about it then that would be ok? so say you knew all the rules, etc. that make the system buy or sell...you would feel more comfortable? in trading it still comes down to the bottom line...does the system make money?

 

[meanreversion]

Hmmm. I always try to see both sides, and I can kinda see what you're saying.

Nonetheless, I'd rather build the system myself, the programming is not that onerous.

 

[bevok]

I think you can buy a system but you have to know how it works and be able to run your own tests with control of data, portfolio etc. Thats why signal services or black boxes are a complete waste of time IMHO, when they enter a perfectly natural drawdown you won't have that confidence, and also you can never be sure of what skullduggerous optimisation may have occurred under the hood!

 

[meanreversion]

Another member of this website, whose background is in programming, told me a story about how a friend came to him with a black box system, and asked him to examine it. It turns out that the stellar performance as evidenced by backtesting was dealing at "illegal" prices, for example, selling at the high of a given bar, when obviously one would not know in real-time when the high was reached.

This kind of thing is easily done.. if the trade is performed at the end of the bar, some systems allow you to sell the high or buy the low (I've come across something like this on Amibroker). It doesn't mean the software is faulty as such, it's simply a program after all.