Why People Do Not Make Money Buying
and Selling Commodities - W. D. Gann
I have stated in my books many times the market does not beat you,
it is your own human weakness that causes you to defeat yourself.
The average man or woman nearly always wants to buy low and sell
high. The farmer always wants to sell at high prices whatever he
produces but he wants to buy what he needs at low prices.
The laboring man wants high wages all the time but wants low prices
for what he buys to eat and wear. This is a violation of a fundamental
economic law and it just will not work. To make a success in speculation,
you cannot expect to buy low and sell high. You will make money
when you do exactly the opposite of what the average man or woman
wants to do or tries to do, and makes a failure and loses as a result
of what they are trying to do.
You will make profits when you learn to Buy High and Sell Low.
You must learn to follow the trend of prices and realize that they
are Never Too High To Buy as Long as the Trend is Up and Never Too
Low To Sell as Long as the Trend is Down.
Opinion of TBSP Right Time
Program
George Moldenhauer
In response to the inquiry from Paul Diehl concerning The Right
Time Programs. I own the Right Time Index Program for stock index
options (OEX). My experience with the program, which I have had
for a couple of years, is less than favorable.
In fact, I have kept an accurate signal log for both the OEX and
XAU signals and they are a far cry from the track record that is
frequently published in the many advertisements that indicate 10's
of millions of dollars in profits. In many cases the dates of their
transactions were dramatically different than what my records show.
When I called the company for technical support, I was told that
my data must contain errors (which I checked and that is not the
case) and any further questions would go unanswered since I purchased
the software from a third party software vendor. Basically, in my
opinion, the ads for this software are hype, and somehow this organization
seems to be immune from any disciplinary action that might stem
from false advertising.
Personally, I would not spend another dime on any product produced
by this company. But I was able to make some use of the program.
I run the numbers each day for several indices and use the support
and resistance signals to switch mutual funds.
A word of caution! The program will change the support on resistance
signals if the market does not respond on the next trading day (i.e.
if the software signals that support has been hit when you run the
numbers for the close of a particular day. The next day must generate
a positive net change close in order for that support signal to
be valid. Otherwise the support signal could move from one day to
the next which accounts for the dramatic results that appear on
your historical graph).
You can access the chart that shows support and resistance under
the Review field and making the selection Graph Cumulative Data.
I don't know how it might work for the futures program. You might
want to experiment and do some extensive paper trading, before committing
real hard earned dollars.
On another subject: I am interested in hearing from anyone with
experience with the Futures Market Analyzer program...especially
the new version being offered on an annual fee basis. I own a previous
version, that in real time, contains some serious flaws that will
dramatically impact the hypothetical track record.
Why Was A System Not Mentioned
in the S&C Magazine Readers
Choice Awards...An Observation, An Answer, and a follow-up
Article by Zoltan S. from Austria
I would like to know why the Swing Catcher Trading System is not
advertised in S&C Magazine. Also, I received the S&C Magazine
Issue containing their Readers' Choice Awards, under the section
titled "Systems: Futures Trading," I see Swing Catcher
was not mentioned. Why is that?
(Editor Note: In answer to the above, I Faxed a reply
to Zoltan similar to the Editor Comments articles about S&C
Magazine in this month's issue. The new article printed below was
subsequently received from Zoltan in response to that...opinions
on this matter are invited from other members).
I would like to submit my unbiased and independent opinion to you
regarding your comments about your dealings with S&C. Technical
Analysis of Stocks & Commodities is a well-known futures industry
magazine and I find that you acted on behalf of the prospective
customers of the system when you submitted your system to S&C
for review.
S&C, as a third party, if it prepares a system evaluation,
needless to say, it should be unbiased and adequately informative.
Errors found afterwards should immediately be corrected and published.
Because the opinion of a well-known third party publisher is highly
appreciated, the errors without prompt corrections can have serious
consequences, first of all in futures trading.
You mentioned that S&C promised and failed to publish an in-depth
review. In the first place, the prospective customers of Swing Catcher
have been negatively affected, for due to the lack of the review,
maybe they could not obtain another third party opinion of the system;
or they were not even aware of the system and may have bought another
system that performs inferior to it.
It is evident that in order to prepare a sophisticated evaluation
of a computerized mechanical trading system, one should install
all the program and see how it really works. Because, some systems
don't work in real-time trading.
Prior to real-time trading the system, the best way is to generate
walk forward (out of sample) tests or to paper trade the system
for a short while, in order to obtain a simulated "real time"
performance figure, with no hindsight, based on a statistically
significant number of trades. The system which they did not install,
even allows testing on portfolio level.
You mentioned that S&C prepared a Quick Scan review, containing
errors and without installing the software and without immediate
error corrections, so I think it's OK that you canceled all ads.
I find it unfair that the ballots used for the S&C Readers'
Choice Award, do not allow the readers to discretionary vote for
a certain system, but only for the systems that use display advertisements
in S&C. Right now, I have the 1994 S&C bonus issue in my
hand. On page 69, the introduction to S&C Readers' Choice Awards
states that "this listing represents products and services
that S&C subscribers are using and/or find useful."
There is no indication that the listing is limited to the advertisers.
In addition, foreign subscribers were excluded from the voting,
this is a pure discrimination, and reinforces the limited style
of the S&C Readers' Choice Award.
Therefore, the "novice" reader has the feeling that the
systems not ranked in the S&C Readers' Choice Award perform
poorly compared to the listed ones and are not worth future investigation.
Why a Broker Can't Always
Answer Phone
if Busy and Uses Alternative - Ira Epstein
In reviewing a letter from (CTCN Member) Wayne Roberts (in July
issue), I saw that Mr. Roberts said he "couldn't believe it"
concerning the fact that at Ira Epstein & Company, what he got
when he called was a recorded message. This deserves a full answer.
At Ira Epstein & Co. we have sophisticated computerized telephone
equipment that places customers into a "Call Que" if all
of our order clerks are busy. An example of this happened this morning,
July 29, when the GDP report came out, the markets went into fast
conditions. The telephones at our company lit up and virtually every
single order clerk was on the phone taking orders from clients.
What happens to someone that calls in while our clerks are on the
phone? At Ira Epstein, the caller is told that all clerks are busy
and that their calls will be answered in the order that they were
received.
Our computers will then place calls, in the order that they came
in, with the order desk. This prevents favoritism and should prevent
any client from thinking that he is not being handled in a prompt
manner. Additionally, in the few times that a client has to go into
the "Call Que", he will hear live quotes on the markets
and will also hear what reports, if any, came out and reaction to
it. I don't know of any other firm that operates this efficiently.
After market hours we have voice mail on our trade desks so that
our accounts are able to place orders. We will take that order,
via the clients instructions from our voice mail, and place it for
them in the proper market. Again, this is an extra service that
is offered.
If any of your readers believe that they can deal with any brokerage
firm that will be adequately staffed to answer all phone calls from
all accounts at one time, they are kidding themselves. The questions
become one of how to balance the resources of the firm while offering
fair commissions, and a high level of service. We have done this
and done this efficiently for our cliental.
Rather than the old method of grabbing a phone and shouting into
it "Hold On" and then finishing with the original caller
and having the clerk trying to remember who he just spoke with,
we beat that chaos. This benefits the clients, the clerks and offers
a high level of efficiency.
As for the rest of Mr. Roberts questioning as to what your CTCN
does, I will not answer that. He seems to believe that CTCN is a
"confidential, closed-circuit for members only."
I do not know if he is right or wrong on that. What I do know is,
if somebody is going to publish a fact they should research it and
at the very least, hear the other person's point of view, so that
the other members do not get a jaded point of view from one sour
apple that may not fully understand a procedure. I think that is
what the benefit of CTCN is to its members and subscribers. Wrong
information or only partial information may not be what they are
looking for.
Did John Hill (Futures Truth)
Benefit From My "Stolen"
Key to Currencies System - Gerald Greenwald
John Hill says that initially, they "back-engineered"
my system Key to Currencies Software. Then he "received"
an anonymous copy of my program logic from "someone" who
had also back-engineered it!
My maximum drawdown trading the basket of the 4 currencies was
about $11,000, over the 15 years of testing.
He says "we have always told vendors to show us where we are
wrong and we will immediately correct them." I told him, he
failed to correct!
He says, "if something is sold to the public, (he) believes
Futures Truth has every right to publish results, irrespective of
how the methodology comes to us." From a "professional"
like John Hill, I have never heard nor would I expect to, such a
totally unethical, immoral posture. In effect, he's admitting to
having accepted my stolen property (which is copyrighted) and to
having resold it for his personal benefit.
Because of its enormous profitability and popularity, I took "Key
to Currencies Software," priced at $85,000, with liberal terms
available, off the market on July 1. However, due to interest sparked
by CTCN's readership, I will answer inquires from CTCN people.
Don't worry, John, I'm enjoying my life, wife, kids, retirement,
etc. too much to sue you right now.
Are Systems That Use Different
Parameters or Only Trade A
Limited Number of Markets Curve-Fitted - Russell Sands
Although it is a definition of technical analysis, I do not agree
with John Hill's suggestion that simply taking past data and using
it to forecast future results is a generic definition of curve fitting.
In my mind, curve fitting means either using different systems for
different markets, or using different parameters of the same system
for different markets, and this is not valid technical analysis.
Historical testing via computer means inputting a set of numbers
(high, low, closing prices), and receiving back an output set of
rules that hopefully will make money trading. The numbers themselves
do not have names, and the computer doesn't recognize the difference
between 'Beans' or 'Bonds'. For a system to be valid, it must work
on all numbers tested, not just those with certain names and not
others with different names.
If a system works on Cattle, but not on Beans, this system is curve
fitted over a specific set of data (Cattle) and it loses all statistical
validity. To believe it will work in the future as it has worked
in the past is very dangerous.
Also, different markets do not have different personalities. Again,
they are reduced to just being a set of numbers or a bunch of algorithms.
If a channel breakout (or any other) method is successful, then
the same parameter must be used for all the markets, for the same
reasons as above. You cannot use a 20-day channel in Silver and
a 40-day channel in Corn, this also falls under the crime of curve
fitting.
I therefore take exception to any system, Futures Truth tested
or otherwise, that either only trades one specific market or group
of markets, or trades different markets using parameters or rules
of the same system. All this proves is what has worked best in the
past, and this will usually not continue to work in the future,
as there is no correlation under this scenario.
This letter is not specifically written to condemn vendors, or
Futures Truth itself. This is a clarification of my definitions
of 'optimizing' and 'curve fitting', and a warning as to what types
of trading systems may be valid and what to stay away from.
Let me close by emphasizing that these are not my own opinions,
but were the opinions taught to me by my two very famous 'market
wizard' mentors, who based on their own long records of success,
obviously know what they are talking about.
Headlines Can Be Traded Profitably,
With No Knowledge
of Past Prices - Edward Forys
Regarding the statement (made by John Hill of Futures Truth) "There
is really no way to design a system without a knowledge of past
prices or past patterns", I would like to submit the following:
I used to trade newspaper headlines only. The way it worked was
this: every day, I would check the headlines in a major daily newspaper
(LA Times). I would also check for major breaking stories. I would
look for unexpected events which would catch most traders (and people)
by surprise. For example, the Tylenol scare, Valdez oil spill, large
plane crashes, invasion of Kuwait, etc.* The reason I did this,
was that in the past, I had observed that almost every time there
would be an immediate reaction and it was generally an over-reaction.
I would track the price forward from the time of the event and
when I thought the time was appropriate (my judgement call), I would
fade the action (go long after bad news and a decline). Inevitably,
the price would return to its original price (or almost, sometimes
higher) before the event and I would get out with a profit. This
worked great and I won almost every time (if price did not move
at all after I got in, I would get out with only a tiny loss). The
biggest problem I had with this system was that it was very boring
waiting for the next news break. It was almost like what I heard
a pilot say about flying an airplane, hours of boredom occasionally
interrupted by moments of terror.
Another problem was sometimes entering the market too soon, especially
if it was a commodity (too much leverage); then, I might have to
endure a paper loss while waiting for price to recoup.
Now, assuming that this is indeed a system, my question is this:
Is this a curve fitted system? When I entered the market, I had
little knowledge of past price history or fundamental knowledge
of the company or industry or commodity. I had to know the current
price to figure out how many shares to buy. If it was a commodity,
I had to know what the margin requirement was to figure out how
many contracts to buy.
Since I did not look at a chart, I had no idea of what patterns
might be there. Was this system subjective or objective or a blend?
I did not use a computer or any fancy indicators, I just tried to
use common sense and the observation noted above.
The main reason this system worked, I figured, was that it was
taking advantage of human nature to sell (erroneously) on bad news.
Others might say that it was the specialists (floor traders) controlling
the market by using the news to their advantage. (Is that why major
news breaks are released to the floor before the public?)
*Even the cold fusion announcement was no exception; after going
straight up, palladium eventually returned to its original price.
I did not fade this particular move because with an engineering
background, I felt the risk was much too high. If cold fusion proved
out to be true, (I didn't know enough physics to figure out if it
was true) the price of palladium would have gone through the roof,
the whole world would have been affected (dirt cheap energy) and
I would have been stopped out with a loss.
The Trend is Your Friend
& Standing Aside If System
Performance Declines - Steve Neslen
Many thanks for your publication of CTCN, and your related products
and services. You have proven yourself to be someone of integrity.
I have been an active futures trader for the past two and a half
years, and have been almost exclusively a short-term position trader.
Since following my system's recommendations almost exclusively,
I have been able to record a moderate success for the first extended
period (four months ended June).
As an observation, two factors stand out as contributory. Firstly,
my system's utilization of profit targets, and my discipline using
them, (I have found MIT orders to be most effective, as many exchanges
do not accept OCOs). Secondly, I note the existence of several clearly
trending markets (notably, crude oil, copper and bean oil).
I am reminded of a cliche offered by one trading guru or another,
"at some point one realizes that the trend is your only friend."
In view of the difficulties I encountered during the last two weeks
of July, and the present lack of clearly trending markets, I must
agree with this guru's sentiment. So, perhaps this is one of those
periods in which one is well-advised to sit on the sidelines and
await further developments.
As I look back over the previous two years of learning experience,
I note that had I known enough to 'sit out' several very choppy
periods, I would have fared much, much better. Perhaps the existence
of only two 'highly ranked' markets recommended by my system could
be thought of as an indicator that the commodities markets generally
are in one such choppy period. So, for the present I shall sit and
wait.
Also, I have recently developed an interest in learning more about
day trading currencies, particularly in view of the difficulties
presented by Globex and night trading. If anyone has information
or advice regarding any of the currency day trading systems currently
on the market, I would appreciate hearing from you through CTCN.
Note: I am particularly impressed with claims made by Michael Gent
for his Recurrence III and IV systems, but have no information from
independent sources.
Mid-Am based data can replace
Globex Data - John Bowley
As many of you may be aware, Evening and Globex data are not used
(or recommended) by various trading systems. This (night) data is
usually combined with day data by exchanges and reported. If your
data supplier does not supply day only data, it is suggested that
Mid-Am mini-contract data be used, (as a substitution for Globex/Night
data) since they have no evening session.
For example, developers of ROCM and another Trading System I use
both agree that it should be OK to trade Bonds and Currencies with
either regular or mini-contracts.
How To Control Broker Order
Accuracy - Carl Iverson
Here is a simplified method I use to control broker order accuracy.
Before I call my broker, I write the following on an 8-1/2x11 sheet
of margin ruled paper:
At the top center, I write my account number. In the body, I write
the order information (buy or sell, quantity, exchange, contract
month, commodity and price or action). Some of this information,
i.e. exchange, isn't necessary in this case - but when it is, there
is no question about which commodity I want.
Then I call my broker and give them my name and account number.
I then wait until my broker responds. That way I know that they
are ready for the order. Next I read the order. This insures that
I don't say buy instead of sell or forget some important data. The
sequence of this information (buy/sell, quantity, exchange, etc.)
is the sequence preferred by the brokers and thus further reduces
the potential for error.
When the broker repeats my order information, I don't have to think
about what I've said. Instead I just visually check their confirmation
against what I have written. In the margin, to the left of the ruled
line, I place the type of order, date, time, broker's name and broker
assigned ticket number.
If I was dealing with large lot sizes or if I was placing my first
orders, I would also tape record my order placement. As soon as
I hang up the phone I would replay the conversation and check my
broker's confirmation against what I had written.
When some type of action has occurred to the order, I write this
information to the right of the vertically ruled line. If the order
is filled, I note the price, date and broker. If it's an expired
day order, I write expired. If I cancel the order, I so note along
with the date, time and broker.
The important point is that each order must at some point had action
taken. This is especially true with GTC or good until canceled orders,
which if not canceled could cost you a lot of money.
This format enables you to quickly spot any incomplete order status.
It also makes it easy to insure that sell orders are covered by
buys and that all quantities are accounted for.
I keep all open orders in a 3-ring binder. Once complete, they're
removed and filed.
Also, I prefer not to chit chat with my broker when giving him
orders. Distractions can lead to errors on their part or mine. If
you must shoot the breeze, wait until after you've received and
checked your confirmation.
Astrological Forecast Follow-Up
Request - Steve Gibson
Looking back at the (astrologically based) forecast made by Carol
Murphy in the May issue, I see that she started out fairly well.
Perhaps you could drop her a line and tell us something about how
she made it? Who knows? Maybe someone has an idea on how to improve
it!
(Editors Note: I did, I sent a copy of this letter
to Carol and asked her to expand upon it in next month's CTCN).
P&L Report on Futures
Truth's Universal System & Why Did Its
Performance Decline & A Simple System I Propose that May Not
be
Doomed to Fail - Vern Nord
As I looked over the June/July issue of Futures Truth, I noticed
they added Futures Truth Universal LT while still keeping the old
Universal System. The Universal LT System is long-term and does
not trade as often as the Universal System. The Universal LT System
appears in both the Top 10 Since Release Date and the Top 10 for
the Past 12 months.
I want to stop here and say that my comments are not made to criticize
Future Truth, John Hill or John Fisher in any way. I merely want
to point out general problems with all system testing.
In the December 92 issue of Technical Analysis of Stocks &
Commodities, John Sweeney wrote a review of the original Universal
System, he said "Well, who would know better how to put together
a system? Futures Truth, headed by John Fisher, has seen the guts
of many systems and monitored their performance for more than half
a decade."
I personally would agree with this statement and Futures Truth
tested this system on 22 different commodities over a 9-year period.
John Sweeney said that results for all 17 commodities across all
nine years were uniformly in the black.
Futures Truth optimized 5 parameters for each commodity to obtain
these results, but they were unable to find any set of parameters
which were profitable on New York Futures Exchange contracts, cotton,
gold, cattle and lumber. If Futures Truth couldn't find a system
that's profitable on every commodity, then maybe system hacks like
myself should stop looking for a system that does it all. About
a year later, Futures Truth showed a detailed report on Universal
with the results on the best six commodities. The report showed
a total profit of over $520,000 for the six commodities over a 10-year
period from 1-83 to 4-30-93.
If you were looking to buy a system that would make you $50,000
a year, so you could quit your job and enjoy the good life, you
would be disappointed.
For the last 12 months, this system has been loosing money overall.
This is typical of all systems, and this is why so few systems show
up on both of Futures Truth lists. Very few of the Top 10 since
release still show up on the Top 10 for the last 12 months, and
the reason is that commodity prices are non-stationary. Any type
of system is doomed to fail. The only question is, how soon will
it fail.
It is like someone said recently, "It is the only game where
they keep changing the rules and nobody tells you." Now that
I have said that, I would like to suggest an exception to the rule.
The one possible exception would be a simple system based on relative
strength similarly to the one used by Timers Digest on the DJIA
and Fidelity Select Funds.
Take the concept of relative strength and rate all commodities
compared to the CRB Index to come up with a list from strongest
to weakest. You could buy the 2 or 3 strongest commodities and sell
the 2 or 3 weakest ones. Add some money management rules and a trailing
money management stop of $400 to $500 and you are in business.
An Opinion Trend Index Products
Should Not Be Covered
in CTCN & Other Improvements - George Bashar
I have been receiving CTCN since the early part of this year and
have found several of the articles interesting. However, I would
like to make some suggestions to improve the newsletter. You should
include some guidelines in this issue as to what should be acceptable
contributions and what should not. Also, your position as editor
should take into account some of these suggestions.
First of all, enough already about Hillary!! Anyone who has been
trading commodity futures for at least a month knows how Hillary
made her killing, and knows that it was not due to her expertise
with respect to fundamentals or charting. She and slick Willie were
given a gift by Tyson Foods camouflaged as trading profits in return
for favors when he became governor. Clear and simple. Why waste
any more valuable space on this matter?
Secondly, I feel that you should refuse all commentary on your
Swing Catcher system in CTCN. You should keep the promotion of Swing
Catcher totally separate from the objective and impartial views
in CTCN. If anyone needs references before buying Swing Catcher,
they should be provided separately, not as part of CTCN. This policy
would heighten the credibility of both Swing Catcher and CTCN.
Finally, since we are all traders, or presumably would not be interested
in subscribing to CTCN, why not aim to get more of a discussion
of subscribers experiences with books, newsletters and most importantly,
systems that work or do not work. This would be the greatest service
CTCN could provide to its subscribers - keeping them from wasting
their money on some of the worthless systems that are out there
being hawked as the latest Holy Grails.
I have enjoyed CTCN so far, up to a point. But, it has gotten somewhat
repetitious lately. I know that you put a small request at the end
of each newsletter inviting contributions to the next newsletter.
Perhaps if you made the request more explicit and explained in more
detail what types of submissions would be welcome, we could all
benefit more from future issues.
Suggestion CTCN Has Ongoing
Trading Contest & Test Systems
Phil Baker
I would like you and your subscribers to talk about any filters
they use in their trading that keeps them out of a lot of whipsaw
losses.
I would also like your subscribers to talk more about how they
trade and about the different trading systems they use and less
about, I bought this system and it's no good or I bought this system
and it's the greatest system ever. Because everyone has a different
opinion, so if anyone wants to talk about trading systems, talk
about how it signals trades and how you use it.
I have also read and heard about using Gann lines to forecast a
change in trend when two Gann lines cross. I would like to know
if you know anything about this and if you do, which Gann lines
should one use to forecast intermediate change in trend? Because
there are so many Gann lines, that if you used all lines there would
be Gann lines crossing at least once or twice per week.
I also have an idea that could possibly get more interest in your
newsletter and get more subscribers involved. I got the idea for
a contest from articles I read in investing magazines and newspapers.
So I think you should have a contest where you publish a different
commodity every one or two months and set a 2-4 year time period
and let interested subscribers enter.
They would test any system or trading method they want to and enter
it in the contest. They must show how they got their signals and
how the system works and also show profits-losses, and trades taken.
You could then show the top 5 or 10 systems in your newsletter and
you or your subscribers could pick the winner. The winner or winners
could get a certificate suitable for framing or 6-month free subscription
to CTCN. I think it would really help a lot of traders, because
they can see how others trade, I know it would really help me.
Pocket Quote Pro Review -
Don Good
I'm replying to Paul Diehl's request regarding Pocket Quote Pro.
I have been using PQP for over a month. I purchased it as it was,
by far, the cheapest method of obtaining both real-time and delayed
quotes.
The "real-time" quotes rarely jive with the "real-time"
quotes I receive by phone through 1st Americans InfoLine. However,
they are usually within 1-3 ticks of each other. PQP's keypad is
electronic and I find it harder to use than if it had buttons.
The biggest problem I've had with PQP is that it's not really portable.
I got it as I often have to travel during market hours and I wanted
to keep tabs on the market. Even though I live in an urban area
and PQP's FM transmitter is near by, I find the PQP is rarely able
to pickup the signal.
So for all practical purposes, it's worthless on the road or in
various locations, other than my office. I was able to get it to
receive signals in one location by moving the antenna to various
locations and finally getting it to work in a convenient location
on my desk. Therefore, PQP is still the cheapest way to obtain quotes,
just don't expect to travel with it.
Editor's Comments
Several years ago Technical Analysis of Stocks & Commodities
Magazine said they wanted to do a detailed full review of Swing
Catcher Trading System. It was to be for the benefit of both their
readers and prospective buyers of the software. It was sent to them
via Federal Express, plus some updates, but the long ago promised
review never appeared.
After waiting patiently for almost a year, they were (politely)
asked about the long delay. I ended up speaking to three top officials
there (Thom Hartle, John Sweeney, and Jack Hudson). Pointing out
to them the promised Full Product Review was for the benefit of
their readers and also improves the quality and value of their magazine,
did not dissuade them from refusing to do the review. In fact, they
would not even give the reason they did not and would not do the
promised Full Product Review.
How Can A Review Be Done
Without Actually Running the Software?
They did in fact do an earlier so called "Quick Scan Review".
However, is was far too short and poorly detailed to be very helpful
to their readers and it also contained some errors. It turned out
the errors and shortness of the review may have been attributable
to them NOT actually installing the software on their computer!
Instead, they did the review based 100% on simply reading the trading
system manual and the accompanying advertising!
Even though they had the actual software disks, they chose not
to install them because I was told it was easier for them, compared
to actually running the program.
Last Year's S&C Magazine
Readers Choice Awards
Ended-Up Biased & Discriminatory
As to why certain products seemingly received no votes and therefore
were not ranked in the S&C Magazine Readers' Choice Awards.
A few months ago I called them about that and asked them why some
well known and good products apparently received zero votes. I also
pointed out it seemed very strange Swing Catcher System received
no votes in view of the fact it received many votes and was rated
as the number one system in a Futures Magazine Readers Survey!
The answer they gave was very disappointing. I was told at that
time they used ballots that only contained the names of systems
and trading products that were doing display advertising in their
magazine. In other words, a product may in fact be the most popular
or "best" product but merely because they were not advertising
it in S&C Magazine, it was purposely not listed on the ballot
and therefore received no votes!
Their methodology was even more alarming in view of the fact most
products do NOT in fact run display ads in their magazine. That
results in the large majority of products being in effect eliminated,
in favor of the small number of actual advertisers.
As a result of their voting method the S&C Magazine Readers'
Choice Awards were unfair and misleading to the trading public.
However, I am sure they did NOT deliberately intend to mislead anyone
as their overall reputation is very good.
However, last year's Readers' Choice Awards survey results are
suspect and of only limited value to their readers and the trading
public. It would be extremely difficult for a trading product/service
to receive any votes if it is not listed on the ballot! Is there
any chance a politician could be elected if his name was not on
the actual ballots...of course not!
I have personally talked to a number of traders who told me they
purchased certain trading products based to a large degree (or even
based 100%) on the fact that a certain product was ranked number
one, or ranked highly in the S&C Awards.
I have also talked to traders who decided against buying certain
products because the product/system was NOT listed in the Awards
rankings, as a result of getting no votes in its category. (Note:
see last paragraph of article by Zoltan on page 2)
These traders were totally unaware that last year only display
advertisers were on the ballot. There very possibly could have been
several other trading products (non-advertisers) that would have
been much better or more useful, etc., than the product they purchased.
Unfortunately, they did not know how severely limited the S&C
Awards were and purchased under the belief they were truly buying
the number one or a highly rated product. Or alternatively, did
not buy or even consider another product or system because he was
under the impression it was no good due to getting no votes.
Today, I called S&C and was told they have changed their policy
and now include non-display advertisers. They have also greatly
expanded the products listed. For example, the number of qualifying
trading systems has expanded to 25 this year on the ballot included
in their August issue. I was also told those results will be published
in their December issue.
This subject demonstrates how awards and rankings of products and
systems can not always be relied upon, regardless of the credibility
or reputation of the source. However, S&C Magazine is to be
congratulated for greatly improving their ballot and voting methodology,
compared to the previous year. About John Bowley's article on substituting
Mid-Am Exchange data for Globex/Night data. That can be done. However,
it makes more sense to switch data vendors and go to a data vendor
that does in fact supply day session only data from the major exchange,
not Mid-Am.
Reference the suggestion from George Bashar, that articles referring
to Swing Catcher be prohibited. There is really no conflict of interest.
In fact, only 3% of past articles were about the system, and they
were written by Club Members, not the System Developer/Editor. However,
I fully agree with George that it would be best if that was done.
Especially from a credibility standpoint.
Therefore, we will try hard not to publish articles from CTCN Members
referring to it. Especially, if the article is not relevant to non-owners
of the program. Sometimes a Member may want to discuss important
money-management or methodology issues, and he may refer to the
system in his article. If that's the case, I will usually delete
the system name from the article. In fact, I have done that (whenever
possible) in this issue and will do that even more starting with
next month's issue.
About all the Hillary articles...George is right...enough is enough...no
more about Hillary!
Thanks
to everyone who has contributed knowledge to this issue of Commodity
Traders Club News. Without you it would not be possible. P.S. -
Remember, as a special reward for making just one contribution/submission
per year, you'll receive an automatic 50% price reduction on your
renewal. Submissions can be any length, long or short; typed, handwritten
or submitted on a disk. Formal or informal. Please participate by
sharing your information and knowledge with other traders. Please
make a contribution about your experiences, both good & bad
with systems, services, advisors, data vendors, and other trading
related product.
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