Enjoy it while it lasts because it never does but when it's broke it doesn't mean it can't be fixed. The true measure of success is the ability to adapt.
isn't it great how on Trading Board many people don't believe it can be done speaks to the difficulty of this biz
irniger: From your opening statements: "... I have come to the conclusion - automated trading does not work reliably and profitably in the long run." _____________________________ With all due respect, I'm glad I did not read your conclusions two months ago when out of desperation I started using a robot on a small live account and on a simulated account. I just can not believe the incredible results I'm getting. Initially it was behaving out of control with several, several programming bugs that the creator was kind enough to fix in order to accommodate my simple but strict rules that I originated from a traditional and time tested indicator. My impression is that the automated set up should buy/sell/close/exit positions when it meets the requirements that you wait for when you are staring at the screen on your manual trades. If your manual discipline does not work, your robot will mimic the same results. If your discretionary trading is giving you good results, a robot properly well programmed should give you the same. I will not mention names, nor entertain PM's since the robot is not a sponsor on this site. I understand they already sold thousand of licenses and it is so powerful that in no time you and most people on this site will hear about them. For your info I'm attaching a screen shot of the robot action one day last week when the overall market was all over. It is the simulated account and you could see only a portion. But notice that the longs are going up and the shorts are going down.Only 100 shares are traded. On my little live account the robot is so ignorant of the symbols it preselects for trading that when when goes long, on five occasions I got out manually at a profit, just to see the stocks move up dramatically for several days. I have fear, this automated set up, does not. Take a look at the screen shot. It speaks for itself. Best! From The Safe.
Automated trading works, just not for you. You probably haven't found the right combination to make it work, and obviously don't want to put in the time to find it either. You also probably have unreasonable expectations like: 1) No down months 2) Sharpe Ratios consistently greater than 2.5 3) No down years 4) Calmar ratios sustainably greater than 3 5) No down quarters 6) No down Weeks 7) I'll give you a little credit that you understand you'll have down days, but then 7 becomes: Not down more than 2 days in a row. Get real. You have to risk money to make money, but no one is going to tell you when to pull the plug. In the end it's a probability game. If you win a supermajority, around greater than 60% and your losses percentage wise are less than your gains then this will make money and has what's called positive expectancy. Finding your own personal style will determine what time frame to trade at, and this is at the heart of automated trading. If you take those criteria into consideration, you'll start to see how easy it is to write an automated system.
I learned so much on this site, that sometimes I'm tempted to give back my 2 cents. In reference to automated trading, whether it works or not. I already expressed my opinion on a previous post. Here are my 2 cents: Do not give up on automated trading or AI robots. Repeat: Do not give up on automated trading or AI robots. Case in point. Another genius wrote a software and it is selling for a ridiculous price. I got it less than 2 months ago. Resides in the computer. While the computer is on, this ingenious program scans the universe of listed stocks. I do not know for sure what rules or criteria uses. By now I suspect what it is. Maybe some RSI(2) or RSI(xx) way oversold that bounces... or something similar. And almost on daily basis shows the pics on my computer screen. I do not paper trade with the signals. But I put them on a crude, simple excel worksheet. Religiously I enter the buys and sell (close) when they come, which is usually every day before the market opens. Since March 27 gave approximately 150 Buys and closed, let's say about 130 of them. Maybe 10 are small losses the rest, perhaps 120!!!!!!! are profitable. I use 100 shares lots and charge $ 2 for round turn commission. No pennies on SEC charges, and/or slippage. Using Open market for Buy and following day Open for Sell. The robot computes closing prices the day it gives the signal, for BUY and Closes. On a meager 100 lot shares, have accumulated so far an outstanding $ 14,000.00 net profits, on less than 30 trading days. Promoters will use let's say 2000 lot shares to impress you with $280,000.00 profits, and so on. It's blowing my mind. I'm attaching the crude excel worksheet. Since it is a little long I will attach in four consecutive links. There is no real and/or paper trade, but this is not a fake either. Kindly, I will not entertain the idea of .jpg the humongous PDF accumulated and given to me by the robot. If you do not believe it, it is OK. It is so ridiculous great, that is hard to believe. Here goes the first link. Three more will follow, I hope. Enjoy! From The Safe.
Automated trading works. I lost everything, each month, for ten straight years with discretionary trading. I only made money since I started automated trading. The two main advantages are that before even starting you will need a back-tested strategy, and that you will apply that strategy. Whereas, in discretionary trading, you usually trade without a back-tested strategy, and often you don't even follow that strategy. The only thing you have to be careful about is money management. Just because automated trading makes money, you shouldn't reinvest 100% of your capital, or, once you get the drawdown, you could lose everything. Whereas, in discretionary trading, money management is rarely an issue, since you constantly lose money until you blow out your account.