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KJ Trading Systems Kevin Davey - Ask Me Anything (AMA)
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KJ Trading Systems Kevin Davey - Ask Me Anything (AMA)

  #241 (permalink)
Elite Member
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Kevin, thanks for the responses. I'm also looking at the systems over on C2. I realize not all can be good and profitable.... but which ones would be representative proof that one can develop successful trading systems via your methodology?

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  #242 (permalink)
Market Wizard
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gumdr0p View Post
Kevin, thanks for the responses. I'm also looking at the systems over on C2. I realize not all can be good and profitable.... but which ones would be representative proof that one can develop successful trading systems via your methodology?

I am not active at C2 any longer. But last time I checked, I had 20 strategies at Collective2. 15 of those are profitable. Some (most?) of them had high percentage drawdowns, mainly because of the extreme leverage I used. Many people at that site like high risk/high reward scenarios.

In general, based on how I develop systems, I consider it good to have return/drawdown ratios of 2.0 (meaning if you want 50% annual return, you have to endure 25% drawdowns along the way). That is the benchmark in my own trading.

As a point of reference, most Commodity Trading Advisors (CTAs) like to have a return/drawdown of 1.0. But then again, they have objectives and priorities that retail traders like you and I don't have...

If you have any questions please send me a Private Message or use the futures.io "Ask Me Anything" thread
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  #243 (permalink)
Market Wizard
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gumdr0p View Post
Digging deeper on Striker, there are two more KJ systems.

One has a return of -52% over more than a year... and the other doesn't show results (which isn't uncommon for newer systems on Striker).

I'm just not feeling a lot of confidence in purchasing the workshop. Am I missing something?

I'm a career energy trader, now an individual proprietary trader. My trading style is very spread, arbitrage and statistical based - and not systematic trading like many here - or what Kevin trades and teaches. I'm always trying to improve myself, and learn new things about the industry. Hence I always found Kevin's post's (and Book) to be interesting and informative. Last spring, when things were very quiet for me, I took Kevin's day class. I did this, not with the intention of becoming a systematic trader, but just as education for myself.

I found the class to be well taught and the subjective matter very interesting. I am somebody who would much rather sit down with a laptop and try and solve a problem/code something/research something traded related than watch TV. Hence I found myself coming back to Kevin's material again and again. In August I finally went live with a new account at Tradestation and started trading a couple of systems. The next four months were mostly sideways (did have a month long drawdown in October) but in December I finally set (two) meaningful account high water marks. This month things have continued to be good and I can honestly say that my account as of close Friday night set a new high water mark. While this isn't a huge amount of money, it is enough to pay for Kevin's course many times over. If it wasn't for some newbee automated trading mistakes I'd be even higher.

If you'd like more comments on the course take a look at this thread. Vendor Review: KJ Trading Systems Strategy Factory


kevinkdog View Post
In general, based on how I develop systems, I consider it good to have return/drawdown ratios of 2.0 (meaning if you want 50% annual return, you have to endure 25% drawdowns along the way). That is the benchmark in my own trading.

As a point of reference, most Commodity Trading Advisors (CTAs) like to have a return/drawdown of 1.0. But then again, they have objectives and priorities that retail traders like you and I don't have...

Before my October draw down I was at 1.45x, and as of Friday night I'm at 1.62x and optimistic about getting to 2.0x soon.

Full Disclaimer: While I have talked and emailed with Kevin many times, I do not know him personally and did actually meet him here at futures.io. Other than being somebody who paid to attend his course I have no financial relationship with Kevin. In other words, while I may seem to be his cheerleader, I'm actually just a happy customer.

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  #244 (permalink)
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SMCJB View Post
.
If you'd like more comments on the course take a look at this thread. Vendor Review: KJ Trading Systems Strategy Factory

Before my October draw down I was at 1.45x, and as of Friday night I'm at 1.62x and optimistic about getting to 2.0x soon.

Nice. Reading the thread, it sounds grueling but possible to suffer through the drawdowns and remain profitable (I wonder what happened to @risingfire ?). One question on my mind in considering this style of system development, is how much time would I need to devote? I already program a bit (a little Sierra and Ninja, plus non-trading stuff), and have been doing stuff in the markets for years at an amateur level. But given that I want to maintain another occupation that I love, what is the minimum I'd need to plan if I wanted to develop systems using this approach?

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  #245 (permalink)
Market Wizard
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gumdr0p View Post
Nice. Reading the thread, it sounds grueling but possible to suffer through the drawdowns and remain profitable (I wonder what happened to @risingfire ?). One question on my mind in considering this style of system development, is how much time would I need to devote? I already program a bit (a little Sierra and Ninja, plus non-trading stuff), and have been doing stuff in the markets for years at an amateur level. But given that I want to maintain another occupation that I love, what is the minimum I'd need to plan if I wanted to develop systems using this approach?

It is grueling. There is no shortcut to successful trading, regardless of what the knuckleheads selling snake oil tell you. If you can spend 10 hours a week, I think in a few months after the workshop you could have 1-3 strategies that might be tradeable (after all evaluations are complete). But, there are so many variables it is hard to tell. I have had students produce multiple strategies within a month of attending, and I'm sure others struggle for months and give up without producing any.

@risingfire is still an active member, and he still submits strategies to the Strategy Factory Club (a great way to build up your strategy library).


I will say this: if you are committed, and not easily defeated, you can do well. But, if you are the type of person who needs to see instant results (or you give up), trading is likely not a good endeavor for you.

If you have any questions please send me a Private Message or use the futures.io "Ask Me Anything" thread
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  #246 (permalink)
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kevinkdog View Post
In general, based on how I develop systems, I consider it good to have return/drawdown ratios of 2.0 (meaning if you want 50% annual return, you have to endure 25% drawdowns along the way). That is the benchmark in my own trading.

If you have multiple systems and they all eventually do poorly (according to your website) .. does that mean that they run ideally at 2.0 and then eventually drift down to a point where you turn them off? If that's the case, what ratio do you end up with overall w/ diversification between systems continuing at 2.0 and others faltering?

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  #247 (permalink)
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gumdr0p View Post
If you have multiple systems and they all eventually do poorly (according to your website) .. does that mean that they run ideally at 2.0 and then eventually drift down to a point where you turn them off? If that's the case, what ratio do you end up with overall w/ diversification between systems continuing at 2.0 and others faltering?

The return/dd ratio is calculated over a number of years, and is highly variable from period to period. When you add all systems up, if you end up with >2 over a long period of time, you are doing pretty well. But sometimes you will be worse than that, other times you will be a lot better than that.

The big key here is that you have a plan/approach with the idea that each strategy will eventually fail. That doesn't mean they will, but as the saying goes "it is better to plan for failure, than failing to plan."

If you have any questions please send me a Private Message or use the futures.io "Ask Me Anything" thread
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  #248 (permalink)
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kevinkdog View Post
It is grueling. There is no shortcut to successful trading, regardless of what the knuckleheads selling snake oil tell you. If you can spend 10 hours a week, I think in a few months after the workshop you could have 1-3 strategies that might be tradeable (after all evaluations are complete). But, there are so many variables it is hard to tell. I have had students produce multiple strategies within a month of attending, and I'm sure others struggle for months and give up without producing any.

@risingfire is still an active member, and he still submits strategies to the Strategy Factory Club (a great way to build up your strategy library).


I will say this: if you are committed, and not easily defeated, you can do well. But, if you are the type of person who needs to see instant results (or you give up), trading is likely not a good endeavor for you.

I want to +1 everything Kevin said. Maintaining my course and objective has taken incredible inner reserves and fortitude. I have had to change my expectations over and over again and work with my emotional fear responses. I've had to change course in approach so many times in order to weed out my bad habits that it feels like I've recreated myself several times over. It has taken boat loads of perseverance and commitment. My challenges will not be your own, but I still consider all the difficulties last year to be of great benefit and value. Many of my strategies still fail the 6-month club test. I'm probably not doing anything good for his club success rate averages (Sorry, Kevin... I continue to try! )

So there are many challenges along the way, but it IS doable. I believe that I have a sustaining and profitable system now and am developing the means to continue forward development. Time will tell.

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  #249 (permalink)
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Hello Kevin,

I am currently enjoying you book as I want to be a more systematic manual day trader with my current system or idea systems.

I would like to know will your book help me with manually back testing my trading ideas vs programming the trading idea and then back testing. Eventually, I do plan to start learning to program via Tradestation.

I have not moved to programming yet cause my mind is still stuck in manually day trading my systematic trading plan, however, I never thoroughly and properly back tested the system or even kept a journal. I am now doing this.

I trade resistance and supports from a service I pay monthly to obtain the resistance and supports. So I do not know how to program the resistance and supports and back test them. Of course the vendor will not share how they calculate these daily resistance and supports. Also, I never used indicators, just price action what i see on the chart. For example, if I see price going up, I get ready to go long per my entry rules. However, I can not program my eyes. So I am not familiar with indicators, I just manually trade the charts for the past 2 years. I have been paper trading for 1.5 years.

Manually back testing is labor intensive, but I guess I am being stubborn and not wanting to give up on my current system, yet the reason I purchase your book was to learn how to properly back test a system and trade the system statistically confidence. But all I know is support, resistance, trend lines and identify trends with my eyes. I am breakout trader. But I saw one of your webinar and it states sometimes it takes 100 - 200 trading ideas before finding one system that may work going forward. And here I am still stuck on one trading system for nearly 1 year.

I appreciate any suggestions, opinions, comments, or questions you have for me. And really appreciate your time and effort in the response. Great Book.

Thank you

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  #250 (permalink)
Market Wizard
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goodoboy View Post
Hello Kevin,

I am currently enjoying you book as I want to be a more systematic manual day trader with my current system or idea systems.

I would like to know will your book help me with manually back testing my trading ideas vs programming the trading idea and then back testing. Eventually, I do plan to start learning to program via Tradestation.

I have not moved to programming yet cause my mind is still stuck in manually day trading my systematic trading plan, however, I never thoroughly and properly back tested the system or even kept a journal. I am now doing this.

I trade resistance and supports from a service I pay monthly to obtain the resistance and supports. So I do not know how to program the resistance and supports and back test them. Of course the vendor will not share how they calculate these daily resistance and supports. Also, I never used indicators, just price action what i see on the chart. For example, if I see price going up, I get ready to go long per my entry rules. However, I can not program my eyes. So I am not familiar with indicators, I just manually trade the charts for the past 2 years. I have been paper trading for 1.5 years.

Manually back testing is labor intensive, but I guess I am being stubborn and not wanting to give up on my current system, yet the reason I purchase your book was to learn how to properly back test a system and trade the system statistically confidence. But all I know is support, resistance, trend lines and identify trends with my eyes. I am breakout trader. But I saw one of your webinar and it states sometimes it takes 100 - 200 trading ideas before finding one system that may work going forward. And here I am still stuck on one trading system for nearly 1 year.

I appreciate any suggestions, opinions, comments, or questions you have for me. And really appreciate your time and effort in the response. Great Book.

Thank you

Thanks for the comment and questions. You are stuck in "no man's land" - you are afraid to let go of your current method, yet you feel a pull to do things differently.

I can tell you that the way you are currently trading is nearly impossible to test, given all the nuances with your current approach.

To be successful with algorithms, you have to be able to program every part of the strategy. It does not sound like you can do that now. You also have to program a lot of strategies (because most turn out to be junk). Then, to test manually is cumbersome, and really a non-starter. You'll never really get traction.



So, my advice - stick with your current trading method if it is working. If it is not, then maybe make a clean break and try something else, like algorithmic with proper development and testing. Don;t try to keep the old, and add the new. I don't see it working.

If you have any questions please send me a Private Message or use the futures.io "Ask Me Anything" thread
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