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1. The issue that I have with mechanical systems and I suppose by extension the people that design them is that they, for the most part, seem to be blind to the intrinsic flaw that lies at the heart of mechanical based trading.

2. A mechanical system is an automated strategy. Certain strategies will do well in certain market environments and potentially outperform their initial code. Markets change. Sometimes that change is subtle and the system still returns a profit, sometimes it is radically different and a period of underperformance will ensue. Sometimes the monkey wrench gets tossed in and s**t blows up. Now you could have multiple systems (strategies) and chop and change them as market conditions change. That however is 'discretionary', which (possibly) systems traders decry?

3. Being the polite chap that I am, yes, it is the 'system's' fault.

4. Well good. This is the topic that came up a few posts back and (seemingly) was resoundingly ignored. This is something worthy of a detailed discussion. The results, if properly done, will toss many systems currently being traded on the scrap heap.

5. This is where the MC is critical. The data that we have, even if you had data from 1880 to the current day, is not sufficient. Now that statement may seem to contradict my position. It doesn't. This point is raised by [USER=22730]@Lone Wolf[/USER] in his post.

6. And this should be rectified.

* I see another post, just above is curious.

jog on

duc