Some strategies are valid but just not scalable, so people "share" them and "scale" them this way. Personally, if the strategy can be backtested, it can be automated and thus can be priced. Discretionary? It is just a method which may or may not be adoptable. I would not pay much in advance. There are people who have strategies which require either large capital or large tech investment or both. So it's "easier" to sell them and invest in something else. I have heard from a friend of someone selling his automated strategy for a few millions and the shop that bought it made ten times that before but it stopped working.
There is no amount of money that would make me divulge my strategy. Too much blood, sweat and tears were involved to develop it. I will teach it to my children one day.
Therein lies the problem. If a discretionary system is profitable, how can one sell it? Because a discretionary system's profitability can change on a dime. So it could not be sold and then expect much success with it's customers if the system starts failing after that dime turn. I would think that only an automated system could be sold, but those can fail also. Regarding the concerns a couple of others here have spoken about, about how if their precious system gets out into the wild and everyone starts using it, that would cause the system to fail...Is that even a thing? Does that actually happen? Can that be proven to have happened?
Even an automated strategy is more or less worthless without the person who developed it. To give you a sense, HFT firms are usually valued at 2-4x their annual revenue (a friend of mine tried to sell his small-scale MM firm and the best he was offered was 2x the annual PnL, for example).
For profitable traders only...how much is your strategy worth? Good strategies are easy to come up - the hard part is following it, forget trying to follow somebody else's, it just wont work. You have to create your own unique strategy if you expect to be profitable. The trader running the strategy is what makes or breaks it while novices think its the other way around. The strategy accounts for about the bottom 10% of the important components of trading. Overcoming your fear & greed and having strong risk/trade mgmt are far more important then the entry signals. Having the hard won experiences as a seasoned discretionary trader is priceless, I could have a chimp throw darts and find a way to make it profitable.
You don't need to prove it happened in any particular case, just think about it logically: if you and I take exactly the same trade signals then we'll compete for fills on both the entry and exit. Trading profits don't materialize from thin air, every dollar you take out of the market came from somebody else's account. I agree that one can't "sell" a discretionary system, but not because such systems aren't robust. Rather, it's because a discretionary system's actual edge resides in the mind of the trader who applies it.
That is not true, though. The asset market (as opposed to a derivatives market) is not a zero sum game, so your profits do not really equal someone else's loss. That sad experience is that most trading strategies are not robust, especially the discretionary ones. Not only the trader is dealing in a world with a lot of variables, but he is also competing with a bunch of other people that are eager to appropriate your alpha. Things that were true historically do not have to be true now. Someone smarter than myself said it best: "You develop fantastic machines, which can measure everything, and you deploy them to track an object falling. You analyze a million occurrences of this falling event, and along with some of the greatest minds you know, you discover gravity. It’s perfect: you can model it, define it, measure it, and predict it. You test it with your colleagues and say, ‘I will drop this apple from my hand, and it will hit the ground in 3.2 seconds,’ and it does. Then two weeks later, you go to a large conference. You drop the apple in front of the crowd...and it floats up and flies out the window. Gravity is no longer true; it was, but it isn’t now."