What it takes to develop a profitable trading system?

Discussion in 'Options' started by Aquarians, Dec 28, 2017.

  1. Actually I just finished implementing the largely theoretical proof of principle (step #1 in my list) for the latest strategy ideas I have and the results are very promising. Next thing, #2: backtest on real marketdata and see if the promised opportunities are there, or darn market already knows what I just discovered. Will let you know, either glory or misery is possible at this moment :p
    #41     Dec 29, 2017
  2. I hope you make it Big Time.
    So Much larger than life. I'm gonna watch it...grow. My eyes are getting bigger like my Bank. Account. o_O
    Last edited: Dec 29, 2017
    #42     Dec 29, 2017
  3. Ran another proof of principle test with improved hypothesis and some tweaks and results are so good that I'm almost purring like a cat. Even if backtests will be disappointing (although I seriously hope not), I've got enough material for a new PhD paper, at least I'm getting my coordinator off my back.

    Although on a second thought, likely there still will be no paper but instead another incremental development based on the proprietary knowledge that I found so far. There's zero incentive to publish something that has even the remotest chance of being valuable for use by myself.
    #43     Dec 29, 2017
  4. I know a lot of failed traders, and I know I'm terrible but options for me are the only way to make profits. You need to work a bit harder but you do not have to be right most of the time- unlike forex or futures which are one dimensional and binary in nature. Most of those traders are quietly mounting losses and kidding themselves that a 'break even' trade is a win. You don't use stops with options and that's a huge plus. My UK site:
    #44     Dec 30, 2017
  5. Handle123


    When I was first learning to program, and I was God aweful the first three years, I went to local community college and I went to Computer Science Dean, I managed to talk the Dean into one class to program using Tradestation software on programming system I had been day trading for couple years, fricking difficult to work evenings/nights, grateful my two days off were Wednesday/Thursday to monitor students working it in lab, have enough time to trade and sleep. At end of semester, system was done but it was not working but 50% of how I traded it, but I provided huge pizza party, but did manage to have Dean give me couple of his lab tech students and they help a great deal, had each one doing separate areas so the other one didn't know what the other was doing. I kept both of them few years part time. My abilities to program went up much more rapidly as I was getting one on one help and they were doing anything I wanted to backtest. I found at the time, Tradestation had major flaws and never came up with 100% confidence. But as years have past, newer languages, and just about whatever you can dream up, programmers figure out how to do so.

    I do see it best when there is a partnership, one guy who can trade and other program, but each should have ideas of how to continue if one gets ill, etc...Also, make it where whatever you doing-partner always be included, otherwise mistrusts form. You are so right, the guy who know how to trade is trading, but unless he also has all the hours to program, he is hugely limiting himself. Myself just too old at 61yo to manually day trade, can't remember all the rules nor all the systems. My best buddy, known him fifteen years, has full time plus job outside of programming, but he is very sharp at programming. So we formed Partnership, there are still areas of trading I like to explore, but can't trade as I once did, and why trade one market whereas programming can track 15,000 instruments, it a no brainer. His programming will get me over the next goal and my systems will allow him to attain his goals.

    What I have found about trading systems, easier they are or K.I.S.S., seem to do the best, the more complex I made systems, less likelihood they be profitable. Then come the "whys", why is simple works and complicated don't work as well. After many years you learn to not make something so abstract that big money are not doing it. You want to design something that either gets you in seconds before or during HFTs/Hedge funds/ big brokerage, that's it. Whoa, but what works? That can be the hard part, and the most practical area of a system is definition of TREND and make yourself dozens of examples that clearly show start of trend. Don't want anything too fast cause whipsaws, and too slow, little left cause getting in too late. There simple is too much information on the web, but great place to start is charting, support and resistance, have well defined trend rules and have 3,000 sample size of trend for starters.
    #45     Dec 30, 2017
    SimpleMeLike and beginner66 like this.
  6. ironchef


    If you read qxr's other posts, you will realize he knows more about trading for a living than many of us here. :finger:
    #46     Dec 31, 2017
  7. ironchef


    I need to get a PhD in TA to understand what you are saying. :banghead:

    I think I will stay with staring at charts.:D
    #47     Dec 31, 2017
  8. rb7


    Maybe, but in some posts in this thread, he seems to say that trading for a living was impossible. But maybe I understood him incorrectly.
    #48     Dec 31, 2017
  9. ironchef


    This year I finally figured out how to program in Excel/VBA. You are telling me that is insufficient?
    #49     Dec 31, 2017
  10. sle


    He's a smart guy but pretty closed-minded. That usually is a bad combination. I don't know what to think of him, to be honest.
    #50     Dec 31, 2017
    rb7 likes this.