Why would hundreds of hours learning help if the energy spread blows out? How would a retail trader hedge gap risk that can occur rapidly? I understand that purchasing otm options is not common practice but for retail traders, it seems prudent. Especially when trading volatile energy spreads. As for bone's method being sound...I think we can agree that there is a 50 percent chance of success based on a sample of 4 referrals. Of those 4, I'm guessing the two successful traders were profitable prior to taking the course.
You are really stretching your assumptions in some areas, selectively ignoring what I have posted in the past in terms of the position management rules my clients use and establish at the time of trade entry ( all energy intermarket spreads and the crack spreads are exchange supported and have all the order functionality that flat price products do, like stop-limit orders ), and showing some basic lack of futures spread knowledge quite honestly. And I don't hoodwink prospective clients - if I screen them and they appear of proper background, I give them client references to independently contact and to ask questions of. In terms of traders going live, I typically will have a one-on-one meeting with them where we discuss their capitalization and we agree on sizing and product suites and constructs that fits their particular risk tolerance. As they build capital we can meet and expand their product exposure. Each client is different in that regard, and I want clients to feel confident and not intimidated when they make the transition from paper or sim trading to live trading.
I'll defer to your expertise on energy trading. I've always purchased otm options as a disaster hedge but I understand many traders do not. Nobody said you outright "hoodwink" your clients. Half of your clients make money and half don't. The ones that do make money tend to be profitable prior to taking your course. Which is to be expected. There is a lot more discretion in your system than you originally claimed. Which again is to be expected. Overall, most ET members would have not criticized you if it wasn't for the hyperbolic marketing.
Everything is relative. Energy spreads are more volatile than eurodollar spreads on average. Metals and Ags are more volatile as you say. And biotechs can gap 100 percent overnight on FDA announcements. Most of these spreads are well behaved until they are not as you say. For a 30 K retail account, that one day might be a disaster. I am not trying to criticize your method. I'm saying that making cavalier marketing statements about them to an inexperienced spreader is irresponsible. Not all spreads turn slowly like the USS Nimitz. Not all spreads behave well. It is not the method...it is the marketing.
Someone trading based on any marketing statements is the higher crime in this case. The responsibility to vet a strategy, method, or tool is on the trader, not the teacher.
That's exactly right ogarbitrage. Don't ever take any vendor at face value including bone. Ask for p/l statements, see if he is a person with integrity, see how he reacts to criticism and then make a decision. The onus is on the trader. But if a trader has to do the vetting, verifying and testing..and all marketing statements are suspect, what is the teacher's responsibility?
In a free market, the responsibility of the seller is not to defraud. And I have seen no proof that bone has defrauded anyone. If you don't like his marketing tactics, his strategies, the man himself, or the way he writes, no one is forcing you read his posts or buy his service.
To defend my ignorant comment a while back "where are the 800 or so liquid spreads", I know of and can follow the hundreds of spreads in just the ED complex (and for your info there is NO volatility in single contract ED flies...think about it! ) What i meant was that i would want a source for EOD data, a charting package with technical studies and signals for the hundreds or thousands of liquid spreads that Bone has researched over the years. This would be extremely valuable along with training. Only an idiot would expect profitability guarantees.
Fraud is a strong word. Misrepresentation and hype are more accurate. Again, the old website and new website are totally different in tone and character. Gone is all the exaggerated "fade one sigma" and "slow moving spread" language. Several posters have pointed out gross inaccuracies in his comments about "OTC PJM vs screen" arbitrage. That language is now gone. This all for the good. It is a poor standard of ethics to think that the only way a vendor can do any wrong is outright fraud. We have differing opinions on vendor ethics and that is fine.
Didn't bone state that a client was at goldman sachs when it turned out the client had never worked there?