Since there is a LOT of concern about the quality, ethics and value of trading vendors...and since it is such an unregulated field....why not create a ratings process/entity for vendors. This could be very useful not only for prospective clients but for the vendors themselves if they wish to be be demonstrably seen as offering value and credibility.
Such a body would need to be carefully planned so that itself could not be subject to claims of bias and poor ethics.
So a set of objective, evidence based criteria and standards would need to be chosen to direct the processes and focus of the entity. Any assessment would have to be based on:
actual longitudinal experience of the products being assessed ( by experienced traders)
assessment of the vendors trading background
assessment of the quality and reasonableness of the marketing content
The output of such a process could be a detailed report of the key areas of focus and ultimately a rating such as A, B, C or RUN AWAY NOW.
Done well such an entity may even find a market for itself and would start the conversation about professional standards in the trading vendor universe
It would require significant resourcing to do this well.
Gosh, well, a self-policing group isn't a bad idea, but considering 99.768111222888% of them are criminals (not actual felons, but liars, cheats, misleading snakes) then it is kind of like asking the Mafia (or U.S. Congress) to police themselves...
I believe that the NFA should crack down on them. In my opinion it is within their rules and regulations but they do not.
The people you would want to rate vendors would be successful traders. Successful traders don't care about vendors that much and they would not want to spend time looking at failed systems. You would probably end up with vendors pretending to be successful traders and promoting their own products.
Now ratings agency of un successful traders rating vendors is certainly possible, but of what worth ?
My thought of it would just be reviews by people who have actually paid for and used the product, and are no longer using it. Using people with several years of trading experience, profitable or not. I think the longer we are at it, the more useful the review is likely to be.
Haha self policing! Of course thats out of the question due to total lack of credibility. NFA - well I'm thiking an independent and international entity. Its not just the USA we are talking about. Maybe it could start as a voluntary/informal kind of thing and build from there.
Good points- but there would be successful traders out there that care about this stuff wouldnt there? And if enough got together then any individual wouldn't have to dedicate much time. There is also a bunch of BE+ traders who know a hell of a lot about what a scam looks like even if they cant make a living trading yet ( I am one).
agree - but there needs to be a structure about what is reported. Personal testimony is too subjective.
Im thinking there is a good analogy between this and the 'secret shopper' or the restaurant critic. The process ( at least the product assessment part) needs to happen without the awareness of the vendor.
There would need to be some kind of member screening as as Traderwerks said it would be likley that vendors would attempt to infiltrate to corrupt the process in their favour.
Very good point. I think a bunch of BE+ trader doing ratings for other ( BE+ / BE- ) traders would be of value. IMHO, the two ends of the spectrum would not want to use a service like this. Successful guys would not have the time/inclination ( enough of them anyway ) to keep up with ever morphing vendors. The other end of the spectrum has not gone through to have given up on looking for the holy grail to really believe such an agency.
I think most BE+/- traders are already set on their trading style and are looking at systems for more trading ideas to refine and improve their trading style.