As many of you may recall, I have been treating traders suffering from TA (no, not technical analysis, trading addiction, the other TA is impossible to cure) for many years now and posting therapy synopses here. In conjunction with my trading development partner Professor Joe Doaks, I have been offering clients rigorous and robust trading systems customized to their particular neurotic trading needs. We offer everything from income-generating startegies for lazy slugs who only want to know that their dividends were paid (the price could go to a buck and they wouldn't care, as long as they were assured their income stream in perpetuity), to high frequency scalping using one-second charts for the ADHD trading crowd ("Forty-five seconds in a trade is an eternity of agonizing anxiety for me!"). But lately I have been noticing a high recidivism rate of clients returning to discretionary trading after months or years of profitable systematic trading. I am in the early stages of understanding this peculiar phenomenon, and will report a preliminary hypothesis shortly. For now I have to go set up my seven systems for the day.
Thanks for the madvice, StarTrackie, but don't knock it. Selling over-optimized systems is a great living. The client comes complaining, you ask "Did you take ALL the indicated trades?" Invariably the sheepish answer is "Well, no." To which my canned reply is "Then don't complain to me, bitch!" But we digress. My morning is done, so leave us continue with a case study in system trading phobia, or STP for short. A typical client was an SCT trader who presented all the classic symptoms of anxiety and abulia (we will discount the fact that when the SCT foule fled ET, he was the only frequent poster they didn't tell where they were going). He was disheveled. Bleeding nails bitten to the quick. Unwashed. Smelly. Eyes wide and wild. I told him he had to pay in cash. "What is your presenting complaint?", I asked. "I dream of channels and volume gaussians on three fractals transforming into writhing snakes and devouring my account," he replied desperately. "You need to become a strict systematic trader," I advised confidently with oiled and practiced precision I have carefully studied and learned to emulate ET sponsors over the years). Thus began my twisted journey into the bizarre perversions of the STP syndrome.
Thanks, Propasia, but you'd cry like a baby all day like me if you had to listen to such bathetic stories all day. Anyway, I sell Mr. Failed SCT Trader a semifast intraday system that kinda-sorta-maybe mimics the action of SCT. I tell him "Watch that little helper study at the bottom of the EasySignal chart. If it turns blue, you punch the blue "buy" button on your IB TWS screen. When the trade screen flashes red, you punch the red "sell" button on TWS. And vice versa. Do you understand that?" He is momentarily slack-jawed with a thousand yard stare. Then he recovers and says, stunned, "You can DO that? You can actually make an explicit and unambiguous trade call?" (My SCT clients say that a lot.)
Trust me, you can't make this shit up. The best humor is the god's own truth. Anyway, after watching the recommended system in action for a few days, my client cried out in pure joy "All this time I have been looking for someone to tell me what to DO!" So he bought the system. And traded it semi-profitably (of course I didn't sell him one of my really GOOD systems). Then one day weeks later he came in all dejected with the complaint "I can't trade your system any more." "Why not?" I asked, cringing inside thinking that the piece of shit had stopped semi-working. "Because it's no fun any more," he answered. Incredulous, I asked "What the fuck is not fun about making money reliably?" He replied "You know how the backtest shows that I may have to take a lick as much as four days in a row before I make a big hit? Well, I just can't take that any more. Knowing I am going to lose, but eventually win. I want something more exciting, like the slots, where you don't KNOW." I thought long and hard, and finally told the putz "I'm firing you as a client. If you crave the excitement of random wins, go back to trading SCT."
you are definitely one of the funnier ones here at ET. How you make up that crap I dont know but its nonetheless pretty entertaining. Thanks for the chuckle....carry on...
Well, Proppy and Gabby, that was just the first instance of STP. The dread syndrome manifests in many forms. Take a client I had who was smart enough not to buy into the "4X daily range" bullshit, but yet not smart enough to really think for himself. He unpiggily allowed as how "I can settle for a reasonable percentage of the daily range." So I sold him a system that trades once a day in the morning. It has a lot of small losers, but every once in a while it bags one of those days when you scream "WTF is happening today? Did the Republicans just get incriminating video of Nancy Pelosi and Scott Brown naked in a hot tub in Vegas negotiating a health care bill with Harry Reid peeping?" To assure compliance with this one-trade-a-day regime, I insist that the client set up one trade and one trade only on his TWS window. This particular client came to me after making consistent bucks, albeit with drawdowns that stick in your craw like gamey roadkill chili, bitching "I just can't stand staring at that blank TWS window all day after I get stopped out in the morning. I want to fucking TRADE!"