Better System Trader

Indicators often form a large part of trading systems, however there are a number of issues caused by indicators that can result in under-performing trading strategies, like: they're reactive, instead of predictive, they have alot of lag, which means they're slow to respond to the markets, and they can often give you a signal too late so you’ve already missed some of the move or even a large part of the move! Today we talk to John Ehlers who is going to share with us a brand new indicator he's developed that overcomes alot of these issues. This new indicator: Minimises lag, Is very responsive to the market, and Gives a fast indication of turning points. Plus at the end of the chat we share how you can get a FREE copy of this new indicator to try it out for yourself.   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Better System Trader is for informational or educational purposes only and does not constitute trading

I'm currently in Sydney for a week doing some work, and I'm staying in one of the hotels near circular quay, overlooking Sydney Harbour. I won't share name of the hotel because it's a well-known name, and it's actually a really nice hotel... However I had an experience with them when I was checking in that I wanted to share because I think it has some nice parallels to trading strategies. Take a listen!   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Better System Trader is for informational or educational purposes only and does not constitute trading or investment advice. Past performance is not necessarily indicative of future results.

Most trading strategies are built to find repeatable patterns in the market and then attempt to exploit any future occurrences of the pattern to make a profit. There are lots of different ways to find patterns, and in this episode Brent Penfold talks about patterns in price action. Brent is a full time trader, author, educator and licensed Futures Advisor, and in our chat you will learn: Why it can be better to focus primarily on price instead of a collection of indicators, How to identify patterns in price action, The dangers of trading stocks and why Futures are a superior trading instrument for active traders, How a ‘universal dataset’ can lessen the risk of datamining, How to blend individual systems into a portfolio to produce smooth equity curves. PLUS, we announce the lucky winner of the Better System Trader ‘Super-package’ giveaway, worth almost $20,000!   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Better

Jack Schwager returns to answer all your trading questions. Jack is a well known expert in the industry, working for some of wall streets leading firms and is also one of the founders of FundSeeder. Plus, he's the author of the best-selling series of 'Market Wizards' books, which I'm sure most traders on this earth have read! In this 2nd part of our chat with Jack, he answers all of the trading questions you submitted (well most of them anyway, unfortunately we didn't have all day to talk!) Plus, to celebrate the milestone 100th episode, we've got a huge giveaway worth almost $20,000 -  and one lucky trader is going to win it. Listen for more details and information on how to enter.   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Better System Trader is for informational or educational purposes only and does not constitute trading or investment advice. Past performance is not necessarily indicative of future results.

When I was learning to snowboard, I still remember the first time I got off the lift chair, strapped myself in the board and looked down the mountain. It was really overwhelming and I wondered how I was actually going to get down there without any injuries! My instructor was very comforting telling us ‘Not to focus on the bottom of the mountain’, because even though that’s the destination, to get there we were actually going to zig-zag down the mountain. So we needed to focus on the next turn and how we were going to execute that. We were told to look where we wanted to go, so if you want to go left then look left, your shoulder/hips will turn, your body weight will shift on the board and that will steer the board. And as you’re moving across the mountain you obviously want to look for hazards, look for where you want to turn and focus on shifting your body weight to steer the board around the corner It was all about the process. By focusing on the process, the outcome would eventually come. That is you'd wor

It can be really interesting and exciting to research the markets and test different ideas but at some stage we need to decide if the strategy is ready for live trading. Some traders can get stuck endlessly researching… Trying to find that perfect system… Which comes at a cost. How do we avoid getting bogged down in research? How do we know when a trading strategy is actually ready for trading? Let’s listen to Kris Longmore from Robot Wealth explain his approach to determining when a trading strategy is ready for live trading.   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Better System Trader is for informational or educational purposes only and does not constitute trading or investment advice. Past performance is not necessarily indicative of future results.

Jack Schwager needs no introduction. He's a well known expert in the industry, working for some of wall streets leading firms. Plus he's the author of the best-selling series of 'Market Wizards' books, which I'm sure most traders on this planet have read! In this chat with Jack we discuss Optimization Myths, referencing some interesting results of a study that analyses the effectiveness of optimization... The results may not be what you expect... And could have a huge impact on the way we test and trade strategies. There are plenty of other nuggets of info too, including: The relationship between the best performing past and future parameter sets, Why optimization adds very little to the power of a trading strategy and where to focus instead, and How to properly assess trading results to determine if it’s your strategy or the market that’s actually any good.   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Bette

Did you know there are some situations that can cause traders to throw away perfectly viable trading strategies, without even realizing it? Imagine that! Putting all that hard work and effort into building a trading strategy but due to some arbitrary decision we’re making during the strategy creation process, we throw the strategy away... When it could have been a good trading strategy... So, what could be causing this? And, what’s the solution? Let’s hear Dave Walton from Statistrade explain what this danger actually is so we know what to look out for, and then briefly discuss one of the solutions to this 'hidden' problem.   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Better System Trader is for informational or educational purposes only and does not constitute trading or investment advice. Past performance is not necessarily indicative of future results.

Have you ever wondered what exactly is it that makes a trader successful? Is it based on personality? A specific approach to the markets? Pure luck? Dr Brett Steenbarger is a trader and performance coach, and gets heavily involved in the recruitment process for trading firms. He gets to interview traders, see how they work and analyse their performance so he’s in a really great position to make these types of observations. Take a listen to Brett sharing the 3 main components he's observed in successful traders.   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Better System Trader is for informational or educational purposes only and does not constitute trading or investment advice. Past performance is not necessarily indicative of future results.

How many traders do you know that have successfully cornered a market? If you're not familiar with the term 'corner the market', it means to get enough control of a commodity, stock or other asset so that you can manipulate the price. There are a number of documented cases in history where people have tried... ... and it usually doesn't work out too well for them! This weeks podcast guest Kurt Sakaeda has cornered a market, however it was more of an amusing accident that an intentional act. And this is just one of the entertaining stories Kurt shares with us in our chat today. Those familiar with the World Cup Trading championships would recognize Kurts name because he's won it a few times, with his first win in 2000 so he's been trading for a while. In our chat with Kurt we discuss a mixture of trading topics, including: How to include seasonality in trading models and why you don’t need to worry about curve-fitting seasonal trades, The dangers of counterparty risk and how to reduce them, Finding profitable

Last week I had to make an emergency trip to the hospital. It highlighted a gap in my trading 'operation' (pardon the pun) so I wanted to share that with you so that you can learn from my mistakes. How will your trading handle an emergency?   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Better System Trader is for informational or educational purposes only and does not constitute trading or investment advice. Past performance is not necessarily indicative of future results.

Have you ever dreamed of leaving your day job to trade for a living? Or living a life of freedom - travelling the world or hanging around at home, doing whatever you like during the day while you live off your trading profits? When I first started getting into trading I had this grand vision in my mind of leaving my corporate job, travelling the world, living a life of luxury all supported by my trading profits. It's a common goal for alot of traders, but getting to that stage can be difficult, and knowing when you're ready to make the leap can be challenging. I regularly receive emails from people asking questions like: How do I know I’m ready to trade for a living, How do I become a full-time trader, How much money do I need, What other factors do I need to consider before taking this step. The guest for this episode, Nick Radge from The Chartist, has an extensive trading history and also mentors other traders. He's in a great position to answer all of our questions on trading for a living, so that's what

“ When you have a bad entry, you can always work your way around it, but when you have a bad exit, this is final… This is when the P&L gets printed.” – Laurent Bernut Exits have such a dramatic impact on overall strategy performance, so having a full and proper understanding of the best way to leverage exits is absolutely essential. In this episode, Laurent Bernut from Alpha Secure Capital combines his witty sense of humor with his knowledge of exits, to entertain and to also share: How to classify exits and set them to achieve much clearer, neater, and better trading strategies, A simple technique to determine if you’ve overstayed your welcome in a trade, stay too long and you could suffer! How to use "the game of two-thirds" to determine the length of a time-exit, Plus much more, including the correct way to think about stop-losses, how to deal with free-loaders in a portfolio and the ultimate entry technique to test you have a robust exit strategy.   Disclaimer: Trading in the financial markets invol

I recently received an email asking me where all the trading ideas are. I think every episode provides at least 1 idea of value, but one that stands out in my mind was the chat with Rob Hanna in episode 7. In that episode he share loads of trading ideas. But he also goes one step further and explains the technique he uses to find new trading ideas... Every. Single. Day. Using this technique we can find lots of ideas to test too. Take a listen to this short audio snippet from Rob explaining how he never runs out of trading ideas to test.   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Better System Trader is for informational or educational purposes only and does not constitute trading or investment advice. Past performance is not necessarily indicative of future results.

One of the appeals of automated trading is that it can be automated. You can 'set it and forget it' if you want. However there can be some dangers with doing so. About a year and a half ago I went through a period of being a little bit slack with monitoring my automated strategies and there was one occasion where my 'set it and forget' approach turned into a case of 'forget it and regret it'... ... A stop loss order for one of my strategies had been rejected ... I failed to check my trading platform for a few days because I was travelling and tired ... That particular lesson cost me 2-3 times the original stop loss size. So that was a stupid thing to do. But I learnt my lesson and now I check my trading platform alot more. A regular checkup to make sure everything is running smoothly is incredibly important because technology issues can (and will) happen at any time. But there's another process I've implemented which has helped me to identify issues that could have gone on for a lot longer if I'd left them un

Market corrections can be a stressful and challenging time for some traders, but it can also be a time of incredible opportunity. How can we not only protect our trading accounts but also grow our capital even further during market corrections? Our guest for this episode, @Ivanhoff, is author of the book ‘Crash: How to Protect and Grow Capital During Corrections’ and in this episode he's going to share with us: Some of the warning signs a correction could be starting and how to protect your capital during market corrections, The opportunities available in market corrections and how to take advantage of these to grow capital, How the characteristics of corrections are changing over time and the impacts this could have for future market corrections, Current market conditions and what this could be telling us.   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Better System Trader is for informational or educational purpo

Earlier this week I was on a flight from LAX back to Melbourne. As we were sitting on the plane waiting for our departure I overheard a flight attendant say to a fellow passenger that one of the other planes had been struck by lightning causing delays to other flights. At the time I didn’t know if a lightning strike on a plane was a bad thing, it sure sounds like something you don’t want to experience, however it got me thinking about the risks of flying. Now admittedly, it’s probably not the best thing to be thinking about just before the plane takes off for a 16 hour flight across the Pacific ocean at night but luckily my thoughts quickly switched to trading and the risks we face as traders. One of the concepts which immediately came to my mind was ‘risk of ruin’, which we first discussed way back in episode 2. In that podcast interview, futures trader Brent Penfold says: "In my humble opinion, I think the risk of ruin is number one or the most important concept in trading." I want to share a little bit mor

"Basing your decisions on past data is like driving down the road, looking in the rear-view mirror". For the most part, traders don't know what’s going to happen in the future and never will. In the previous podcast episode, Gary Hart explains how considering future probabilities can be beneficial, suggesting traders “base decisions on the probable future instead of the certain past.” In this episode, we explore this idea further by reviewing a dangerous trading assumption and how traders can better position themselves for future market conditions.   Disclaimer: Trading in the financial markets involves a substantial risk of loss and is not suitable for everyone. All content produced by Better System Trader is for informational or educational purposes only and does not constitute trading or investment advice. Past performance is not necessarily indicative of future results.

Our guest for the episode is Gary Hart, the founder of Trendfinder Trading Systems, a company offering mechanical intraday and swing trading strategies in futures. Gary has been trading futures for close to two decades now, becoming a member of the NFA and a registered CTA. He's had a number of trading strategies take the top spots in Futures Truth rankings so we’re going to discuss how he builds trading strategies that do that plus we also cover a lot of other aspects of trading, including: The challenges of developing day-trading strategies and how to overcome them The worst time to trade intraday strategies that can hurt performance Why price-based strategies have lost their edge and how integrating additional data can provide superior performance over purely price-based strategies How to construct a portfolio of strategies and identify ones that complement each other Plus much more, including overfitting, optimization, swing-trading, correlation, market behaviour, index trading, volatility and reusing tr

One of the biggest challenges we face as traders is strategies that either fail or experience a reduction in performance over time. There are a number of possible causes for this, one obviously being changes in the market. In podcast Episode 10, Perry Kaufman discussed the change in the markets and how they've become noisier over time, with an increase in erratic movements up and down. This increase in market noise can have a huge impact on trading strategies and particular trading styles too and we're going to hear a little bit more about that from Perry today, including: How market noise has changed over time and what it means to different markets, How to measure the level of market noise, The impacts market noise has on particular trading styles and how to adjust strategies accordingly, and How this information can be used to our advantage to determine the type of strategy that suits a market. So lets take a listen to Perry.   Disclaimer: Trading in the financial markets involves a substantial risk of lo