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system designers begin by looking for the magic indicator that's going to make them rich. It doesn't exist. Instead, observe the market, get to know your chosen market, and look for repeating patterns or combinations of factors that seem to have predictive value. Then try to explain why these patterns or factors may work. I'm not a big believer in doing computer searches and statistical fits. The markets are much too dynamic for these searches to reveal more than a data fit over a specified time period. These types of systems will usually fall apart as soon as you try to use them on real trading. Unfortunately, the financial papers are littered with these systems, claiming riches beyond your wildest dreams. If a system doesn't produce good results over many time periods and market types, avoid it like the plague. Let's say you've got the concept and it makes sense; now what? Now you work. As an example, the systems I use took four years to develop and test, and they are still a work in progress. It takes, in many cases, thousands of hours to program, test, change, re-test, and so on, before you may have a system that makes money in real-time trading. I know that there are those who would lead you to believe that this is not the case, but this has been my experience. If you are unwilling to give system development this kind of dedication and time, leave it to others. If, however, you have what it takes, you will find it to be one of the most satisfying things you'll ever do. |
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Neal: Wow! That was a mouthful. How can traders reach you? |
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Doug: Here is my name and business address: |
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Doug Patrick
Crash Proof Advisors, Inc.
5820 North Federal Hwy., Suite D4
Boca Raton, Florida 33487 |
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Phone: (561) 988-2364
Fax: (561) 994-4640
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