I think consistently make 55% in 45'ish day is an unrealistic expectation. What makes you think you can achieve that sort of result when the big boys can't do it. Auto-trading is really all about risk-reward. The higher the return, the bigger the draw-downs you need to expect. If you are operating a modest sized account, you need to be aiming for low-risk, safe, consistent returns, rather than high-returns which could also blow your account. I've got some very high return strategies, but don't trade them, because if you start trading them at the start of one of their down-turns you blow the account. FWIW, from writing the first line of code to having a system running unattended 24 x 5 was around 6 months (full-time). Interestingly over 50% of that time was spent building, testing and running the forward testing environment.
What makes him think he c an do it while the big boys can not? Maybe that he is not a big boy. It is a lot easier to make high returns on small amounts, where one can enter and leave the market "at will". Once you get big, just a market stop will get spread over many ticks until it is filled ;( Small accounts have SOME advantages
I am going to answer to your statements in the order of your post. Premise: I have a 12 years experience in trading, 7 years in trading systems, 4 years in automated systems. I taught myself to program vba, and I don't have a computer science (nor scientific) background. I don't know/understand as much as most people on this forum (the Automated Trading section), but I am very driven and I like to keep things simple, since I only understand them that way, but that is probably an advantage. "Unrealistic expectation" - "big boys can't do it": The big boys in my opinion are not very intelligent. If they are knowledgeable they are distracted by all the knowledge they have. What makes them "big"? Neither their knowledge nor their intelligence. The big boys have a problem with what E.P.Chan talks about in his 8th chapter in his "algo trading" book: capacity. They have restrictions, rules, they have to answer to their even dumber bosses (I know because I work at a bank, and worked at an investment fund before and other companies). I definitely think that I should be able to do better than the big boys. As far as I have understood these people waste millions in trying to send their orders one millisecond faster than everyone else, but do not spend any reasoning into what order to send - they let that part be discretionary. I am not saying that all the big boys are this stupid, but it seems that most of them are just as stupid as the regular investor or day trader. That's right and I would like to aim at making about 100% per month, with the small capital I have (6000 dollars). Then, once I'll get to 1 million dollars, I know that I will start having "capacity" problems. I know I may sound ridiculous, but I'd like to stir some debate here. Besides, I believe in what I am saying. "...low-risk, safe, consistent returns, rather than high-returns which could also blow your account.": It makes sense but also not. I blew my account many times already, but it was so small (a few thousands) that it was like a fee for a trading course. Also, if you have 5000 dollars, and they can become 100,000 if you risk big, but they could also get to zero, at a 33% chance, well in that case I would rather risk big, and make it go to 100,000 (with a 33% chance of losing everything) and then play it safer, only once I get up there. Ultimately, I do think that you can afford to be more reckless the less money you have. I know there should be a formula for calculating this, but I am bad at formulas - so I am happy to just sense it. It should be like for lottery players. They risk everything (the cost of the lottery ticket). For me it's not exactly like the lottery, but it's close to it, because if I play it very safe from the start (making 20% a year), then trading will never be of any use to me. If I had a million, it wouldn't be the same, because you'd already be rich and it would make no sense to trade to begin with... anyway too complicated to get into all this because someone will reply that if you had 100 millions, it would make sense to be risking that million as well. Summary: with a small account, and your life doesn't depend on it, it makes more sense to take big risks (with a profitable trading system), than if you had a big account and your life depended on it. "I've got some very high return strategies, but don't trade them, because if you start trading them at the start of one of their down-turns you blow the account.": anyway, I don't know much about Sharpe Ratio and complicated measurements of returns, but I could get as far as understanding the Return On Account (in the tradestation reports) and this means that I can discern the difference between High return with low drawdown and high return with big drawdown, obviously a good system is one with a high return on account (which incorporates the drawdown). There's no need to discuss this any further, on which high return strategies we should discard and so on - let's just invest based on the ROA. "FWIW" and building automated system: Yes, I know that part, as I said in my premise. But maybe you're addressing this to the other post, the one by TrailingStop3. Thank you all for your precious contributions (and votes on the poll).
A million dollars is not a lot of money and certainly doesn't classify you as "rich". There are far easier (and low risk) ways than auto-trading to make a million dollars (read Rich Dad Poor Dad). And I think you are seriously, /seriously/ under-estimating the resources and capability of the "big boys". They pump millions of dollars into this, using some of the brightest mathematical minds. To think that one of us can unravel what they cannot is being naive.
A million dollars is not a lot? That shows the difference between us and it explains why you are saying what you are saying. You never tried to make more than 100% a year, because you never needed to. Actually, as I said, with that kind of capital, I'd be playing it safe as well. At any rate, despite the fact that you were totally respectful, I am going to place you on my ignore list (sorry, but it's necessary), because I can't afford any more discouragements from you. I will come back in a few years to either tell you that I've proven you wrong or that you were right.