Would you lease an automated trading system

[dom993]

Hi there

I am asking you, ladies & gentlemen, the following questions :

1. "Would you ever lease an automated trading system"?
2. "If yes, what would be the key aspects you would base your due-diligence & final decision on"?
3. "Would you rather lease a system running on NinjaTrader, or would a signal-service off Collective2 be a better alternative for you"?

I am asking these questions because I am seriously considering offering my trading system for lease ... but I want to gauge the level of interest for that type of offering, before getting into all of the necessary steps for such endeavor (forming a legal entity, getting a website up & running, webinars & other forms of advertisement, etc.).

I know a classic objection is "if this system makes money, why would you lease it instead of trading it" - at least I can answer that one right away: I am trading this system, to the max of my (limited) current financial capacity. And I see no reason not to offer it for lease - CL trades enough volume to have a few tens of contracts trading the same strategy (which, BTW, has currently 3 different configurations each with its own entry level).

Thanks in advance for your responses

 

[BeginnerJoe]

There's a guy posting just now that he made 50,000% in less than one year. Can your system do that ? If yes, I'll lease it.

 

[malaguti]

Hi there

1. "Would you ever lease an automated trading system"?
2. "If yes, what would be the key aspects you would base your due-diligence & final decision on"?
3. "Would you rather lease a system running on NinjaTrader, or would a signal-service off Collective2 be a better alternative for you"?

1) perhaps
2) Results, win loss ratio, highest win, loss, return to risk etc. market its applied to , max drawdown, timeframe..ususal rubbish
3) ninja I guess

 

[dom993]

Thank you BeginnerJoe & malaguti for taking the time to respond - I wish you a fun & profitable year!

 

[dtb2]

I would not have much confidence leasing someone's system, it would always be in my mind, why doesn't the system owner just scale up?

 

[dom993]

I would not have much confidence leasing someone's system, it would always be in my mind, why doesn't the system owner just scale up?

In my case, because I already trade it to the max of my account capacity.

 

[darktrade]

If your system works, then compounding will make you rich. Why giving away your edge?

 

[malaguti]

I would not have much confidence leasing someone's system, it would always be in my mind, why doesn't the system owner just scale up?

or more importantly what does the owner know that I dont

 

[dom993]

If your system works, then compounding will make you rich. Why giving away your edge?

Let's say the system can return over 100% on required account size in good years, and 25% to 50% in not-as-good years. It is fairly easy to see that the max that can be done after a good year is to double the position size, and it will take two or three not-so-good years to double the position size.

Compounding works over long periods of time. Leasing my system can provide me with additional short-term revenues, it doesn't give the edge away as the lessee only receive an executable strategy and an overview of its working principles, but none of the details that actually form the real edge.

Am I afraid someone can reverse engineer it? Not at all ... anyone able to do that, is better off off applying that talent to creating a masterpiece trading system.

 

[dom993]

or more importantly what does the owner know that I dont

Obviously, enough to create that trading system, and successfully trade it live. But that's a valid concern.

What I do know, and I share, is the complete backtest of the system since that market inception (really, since that market went full electronic, in January 2007), MonteCarlo simulations aimed at assessing the maximum drawdown one should be prepared & willing to trade the system through, the account size that I use for myself to trade it in 3 different configurations.

But I don't know the future, and nobody does. Trading is an exercise in odds & probabilities.

 

[D70]

Hi there

I am asking you, ladies & gentlemen, the following questions :

1. "Would you ever lease an automated trading system"?
2. "If yes, what would be the key aspects you would base your due-diligence & final decision on"?
3. "Would you rather lease a system running on NinjaTrader, or would a signal-service off Collective2 be a better alternative for you"?

I am asking these questions because I am seriously considering offering my trading system for lease ... but I want to gauge the level of interest for that type of offering, before getting into all of the necessary steps for such endeavor (forming a legal entity, getting a website up & running, webinars & other forms of advertisement, etc.).

I know a classic objection is "if this system makes money, why would you lease it instead of trading it" - at least I can answer that one right away: I am trading this system, to the max of my (limited) current financial capacity. And I see no reason not to offer it for lease - CL trades enough volume to have a few tens of contracts trading the same strategy (which, BTW, has currently 3 different configurations each with its own entry level).

Thanks in advance for your responses

Do what most serious traders do and ask around for some backing.