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 or investment advice. Past performance is not necessarily indicative of future results.

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 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 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 work your way down to the bottom of the mountain with hopefully no broken bones!

However, if you were to just focus solely on the bottom of the mountain, then you're likely going to fall down and crash.

Trading can be a very outcome-focused activity, there is the temptation to focus on the results of our trades.

Did the trade make or lose money, how is our P/L progressing for the month or year?

• But is this the best focus for traders to have?
• Should we be focusing more on the outcome or the process and what produces the best results?
• Do we need to have a balance between the two, and if so how?

Let's take a listen to performance coach Rande Howell now as he shares a story about an Olympic hurdler and how his approach to focus applies to trading performance.

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.

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 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.

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 trades in a crisis, and
• How Kurt accidentally cornered a futures market and the amusing results - the 'authorities' weren't too happy.

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.