Collective2

Rebuttal, posted on Sept 21, 2011 by system developer:

I most certainly appreciate the positive focus of your comments on the creditable aspects of S&P Swing. I do understand that S&P Swing is not suited for everyone’s preferences, goals, desires or trading styles, even if it is for me or for others. I wish you well with the choice of your next system.

I must admit that the trading conditions since the August 8th equities bottom have been extremely challenging, even considering the variety of aspects through which I view the markets in general. As most know, the back and forth between high volatility (prior) and low volatility (more recent) is a common and accepted aspect of market action. Evaluation of any systems performance is best done under a variety of conditions. As you imply, obviously other system developers have experienced this ‘squeeze’, from the similarities of lower average performance characteristics over the past 30 days, for many systems. My consistency of ranking in this time frame reflects this ‘averaging’ of all systems for current conditions.

Regarding conditions, one of my parameters, based upon a major stock index, shows an average of 1% variation over the past 6 weeks. This one condition alone establishes an environment for either quick trading (I will NOT allow this to become a day trading system), lower probability trading, or, no trading. Commodities such as crude oil, silver and gold have also observed muted behavior recently. Witness the smaller average profits on my most recent positive trades, reflecting quicker than desired, back-and-forth movements in trading ranges of several markets.

I am not yet prepared to account for the advantages/disadvantages of auto-trading at this point in my system development. I will be better prepared in the future for this aspect, after maintaining focus on stability, growth rate, etc. as primary goals. I have already experienced an auto-trading exit aspect for which I must first adjust for my systems profit goals. I must further optimize for additional auto-trading traits later. I understand that some subscribers received proper fills on one particular trade, while undesirable effects (market orders executed rather than limit orders) were encountered on some auto-traded accounts.

Two other unprofitable trades, to which you might possibly refer, whether or not affected by auto-trading, were either far outside of normal deviations, in one case, and, in the other case, ultimately reverted to expected levels just days after my exit, taken for technical aspects and a desire to free up remaining capital and to move to more profitable opportunities.

Regarding the loss of fees, I have been told by at least one other subscriber who had made many months subscription fees on a trade or two as well, specifically having created over 30 times his fees within the first 6 weeks using my system. Even sacrificing some of this gain within losses would have been expected at some point.

As far as the multiple of fees lost, if my fee were tripled, your loss would only a little over 3 times your fee, rather than 10. Therefore, I take that part as a compliment.

Once again, beyond auto-trade, this is all about the conditions present in the short time frame in question.