Essentially a trading system is a set of rules or logic that signals what instrument to buy/sell, when to buy/sell and how much to buy/sell. It is as simple as that; think of a trading system as a systematic way of buying or selling financial instruments.
I have a passion for building and testing trading systems. I can tell you first hand that my most profitable trading system was the simplest to write. That being said you will not find specifics on my personal strategy on this website, or anywhere else for that matter.
Caveat Emptor – Buyer Beware
(NEVER Buy a Trading System)
Every man and their dog are spruiking a trading system these days. With all these super-duper trading systems developed by former NASA engineers and software-based robots you would think it is easy to make money. Personally, I am yet to find a commercial trading system that I would invest my own money with.
Steps to Take to Avoid Getting Scammed
- Don’t believe the marketing.
- Are the advertised results independently audited?
- If the system is so good why are they selling it?
- Investigate the LLC selling the system.
- Be wary of positive reviews from affiliates.
- Make use of regulatory authority’s websites.
The Commodity Futures Trading Commission (CFTC) has an excellent article on the dangers of trading systems. The Australian Competition and Consumer Commission (ACCC) also has an excellent article about investment scams.