Sosnoff craps on system trading - futures io
futures io futures trading

Sosnoff craps on system trading

Discussion in Traders Hideout

      Top Posters
    1. looks_one Cloudy with 1 posts (0 thanks)
    2. looks_two Pedro40 with 1 posts (2 thanks)
    3. looks_3 8020 with 1 posts (0 thanks)
    4. looks_4 Jigsaw Trading with 1 posts (6 thanks)
    1. trending_up 1,343 views
    2. thumb_up 8 thanks given
    3. group 5 followers
    1. forum 5 posts
    2. attach_file 0 attachments

Welcome to futures io: the largest futures trading community on the planet, with well over 125,000 members
  • Genuine reviews from real traders, not fake reviews from stealth vendors
  • Quality education from leading professional traders
  • We are a friendly, helpful, and positive community
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts
  • We are here to help, just let us know what you need
You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

(If you already have an account, login at the top of the page)

Search this Thread

Sosnoff craps on system trading

(login for full post details)
  #1 (permalink)
Citrus Springs FL/USA
Experience: Advanced
Platform: Omnitrader, TWS
Posts: 6 since Jan 2016
Thanks: 1 given, 1 received

Sosnoff said it a few days ago on Chat With Traders. You can throw out all that quant crap. It doesn't work and never will (not necessarily verbatim but in content).

Tom is a smart guy and I respect what he says but this means nobody is making any money with an algo and it is luck if they are.

I would really like to hear what others think. I am grinding away building strategies and seeing all the activity going on by other very qualified and respected individuals.

How do we embrace Sosnoff and algo trading?

Started this thread Reply With Quote

(login for full post details)
  #2 (permalink)
Pittsburgh, Pennsylvania
Posts: 563 since Jan 2013
Thanks: 33 given, 377 received

Well, pretty much nobody has a positive P/L on Tastytrade, so he isn't the best person to judge others.

Also just because he doesn't know anybody who makes money with system trading, that doesn't mean they don't exist....

Reply With Quote
The following 2 users say Thank You to Pedro40 for this post:
(login for full post details)
  #3 (permalink)
Site Sponsor

Web: Jigsaw Trading
AMA: Ask Me Anything
Webinars: Jigsaw Trading Webinars
Elite offer: Click here
Jigsaw Trading's Avatar
Posts: 2,977 since Nov 2010
Thanks: 823 given, 10,316 received

I guess you have to quantify the statement.

My estimate is that there are zero people making money from automated systems in NinjaTrader, Tradestation and other retail systems that allow it.

Now - I hold that opinion partly because these platforms put you in a box.
- They do not support spread/arbitrage trading
- They force you into making decisions/backtesting based on price along

So the type of trading you are forced to automate is going to be using historical prices to anticipate a future move.

That's quite different from what HFTs/automated market makers do.

From a longer term perspective, the only person I know that does longer term strategies at a quant firm is trading multi-instrument strategies, so a sort of longer term arbitrage.

So whilst automation is possible - the sort of automation strategies you can employ with retail trading platforms is very specific and not really what is going on (in my experience) in the professional world.

So no backtesting of order flow, no real support for arbitrage, no order book etc. It's very limited. It's basically letting you test combinations of indicators.

If you have any questions about the products or services provided, please send me a Private Message or use the "Ask Me Anything" thread
Visit my futures io Trade Journal Reply With Quote
The following 6 users say Thank You to Jigsaw Trading for this post:
(login for full post details)
  #4 (permalink)
birmingham al
Posts: 5 since Oct 2016
Thanks: 2 given, 0 received

He really came off as arrogant and full of himself in that interview. Apparently no trading is profitable except HFT and selling volatility the way Sosnoff does. I wonder if he consulted with Ray Dalio or Jim Simons on that?

Reply With Quote
(login for full post details)
  #5 (permalink)
desert CA
Experience: Intermediate
Platform: NT7, SC, ToS
Broker: AMP, DT, TDA
Trading: CL,NQ,YM
Posts: 2,134 since Jul 2011
Thanks: 2,387 given, 1,723 received

A verified case reported in the media is Virtu, the first HFT billionaire. Maybe some algos, but
run with the HFT advantage.

Mish's Global Economic Trend Analysis: High Frequency Trading Hails its First Billionaire

Visit my futures io Trade Journal Reply With Quote
(login for full post details)
  #6 (permalink)
North Carolina
Experience: Beginner
Platform: NinjaTrader, Tradestation
Trading: es
Posts: 644 since Nov 2011

Devil's Advocate

This is a very tricky subject, but I think I can provide some illumination. Well, first to play devil's advocate, a backtest or historical study can only disprove hypothesis about the market. These hypothesis are primarily based on the presumption of patterns in the market. The problem is how many types of systems can be built that don't work? We can imagine we can build infinitely many rules that don't work. What does that imply? It means that your confidence threshold that a system works needs to be infinitely high.

Some other thoughts and perspectives:

1. There are studies comparing discretionary CTA's versus quantitative CTA's and the quants tend to outperform.
2. It may be the case of something that worked better in the past but no longer works as well. Quantitative trading worked in the past when it was only accessible to a few sophisticated traders but now quantitative platforms and backtesting ability has trickled down to masses devaluing the edge. In a similar fashion, traditional technical analysis may have worked better in the past before it was popularized and devalued.
3. Defining something as either works or doesn't work is an ill defined form. The capability for quantitative trading to work must take into account the skills of the trader. I'd expect to see far different results from someone who thinks that system trading is plopping down a moving average and running an optimizer versus a trader who is actively tracking the market, coming up with original ideas, and using advanced statistical and analytical tools to derive original insights and value.
4. Defining something as either works or doesn't work is an ill defined form. Most things in the market work to a degree. Keep in mind that a 30% return is considered quite high among professional money managers.

What I really believe:
I don't know Sosnoff, and so that part I won't address. As far as algo/quantitative trading there is probably tremendous value to it, and I'm sure there are profitable traders using these methods. For one thing, it is much easier to execute a quantitative system in a real money account. On the other hand, my sense is that strong discretionary traders should have an inherent advantage in terms of robustness and longevity as compared to any singular testable trading strategy. But, quantitative traders are certainly not limited to running a singular strategy, either and actually have certain advantages when it comes to diversification. My sense is that again a discretionary trader should have a more realistic, a more valid model of the market. A more valid model is more likely to work in the future.

My sense is that for any long term success "one dimensional" traders are less likely to succeed. A trader who only runs backtest or trades using rules is a one dimensional trader in my book. A trader who only uses their discretion is likewise a one dimensional trader. A true professional trader should have capability to engage in a variety of trading styles and find success with them. A true professional trader should not only be able to find success with different styles but should actively develop their capabilities in different capacities. Developing gray box systems is one way to pursue that vision.

Reply With Quote

futures io Trading Community Traders Hideout > Sosnoff craps on system trading

Last Updated on January 20, 2017

Upcoming Webinars and Events

NinjaTrader Indicator Challenge!


Battlestations! Show us your trading desk - $1,500 in prizes!


Importance of Finding Your Own Way w/Adam Grimes

Elite only

Journal Challenge w/Jigsaw


Copyright © 2021 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432,
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts