Customer Reviews

Trading Systems: Secrets of the Masters

5 star:		(7)
4 star:		(1)
3 star:		(1)
2 star:		(3)
1 star:		(5)

 

 

As mentioned by the author this book was written by submitting over thirty of the same questions to so called systems trading experts. It is really laughable that he ask them to write about their first system, since most first systems composed by anyone is junk. Then he ask them to come up with one system written in English and most come up with silly little systems that have huge drawdowns, even when back tested. I, myself have at a least a half dozen systems that backtest better than any of their systems. Another annoying part of the book is a few of the expert system writers don't provide enough information and only advertise their own books or systems for sale. This book was not worth having in my library.

This book is based upon a sound premise. Interview the masters and note the details of their methodologies. Sounds like a great idea huh? Two problems though. None of the traders interviewed in this book can be deemed a "master". Secondly, no "master" would ever reveal his specific methodology. All of the traders in this book are nothing more than commercial system writers. Get that through your heads people! The only talented researcher out of the bunch and notice how I said researcher not trader is perhaps Nelson Freeburg. Systems have a very short life, so even if you do happen to come across a good one and even if you have the proper discipline to trade it, you will still probably fail. Do want to know why? Because markets are not static, they change. They are in a constant state of flux. Read the interview on William Eckhardt in "The New Market Wizards".

This is one overpriced, poorly written, and generally careless book! In short, the book is made up of "interviews" with some of the leading designers of trading systems. Although many of the names will be familiar to system designers, there is little information that demonstrates that these people are indeed the best (returns, for instance). That is not the real problem here, though. The "interviews" are all alike; Krutsinger asks each person essentially the same canned questions. Unlike more astute interviewers, such as Jack Schwager, Krutsinger does not challenge any of the answers of the interviewees. What we are left with, then, are canned interviews that were not even done in the presence of an interviewer. Krutsinger himself sometimes writes awkwardly and unclearly and, in fact, commits many careless typos and other errors (JESSIE Livermore? I thought he was a GUY?!). The best part of the book, however, is Krutsinger's interview of tradi! ng master Larry Williams. This chapter alone may be enought of a reason to read this book, but don't expect much else. It seems that there was not much effort and time put into writing this book. Accordingly, readers might be wise to put forth about the same amount of effort.

This book is of no value!
Interviews irrelevant,system ideas presented light like smoke.
If you want to make money, instead of buying this book try to write one alike.
Don't make the mistake I did by buying it.
Period

The author was rather lazy in writing this book. He asked the "Masters" the same questions. You cannot ask the same question to people have different trading styles. The question of which futures should be retained or cancelled is really stupid. It doesn't help traders to learn something useful. Some of the "Masters" didn't answer all of them. And some answers were very confusing. I would prefer Schwager's Market wizards. This book is also overpriced. Fortunately, I borrowed it from the library. Not recommended!

The interview section is fine and interesting, however, the systems (code) given in the appendix may hardly be considered as a system from the masters (132% on margin and drawdown over 8 years !). The book does not deliver as a reader of the previous book, The Trading Systems Toolkit, would expect.

The book is essentially a compilation of questionnaire responses that Krutsinger received from a handful of traders. There are actually systems described and Tradestation code is listed for each one, but if one looks closely, most of the "systems" are literally "made-up" by Krutsinger. Since the famous traders are hesitant to describe their best-performing systems, Krutsinger is left to scrounge for formal systems based on their vague answers. Krutsinger does test each system, although I found the results of almost all of them to be disappointing. For example, most systems averaged less than $7000 / yr, not including commissions. There are some well-performing systems that one could use as starting points, but unless you like to hear lots of commercials for the full version of each author's system or commercials for Tradestation, it's not really a book worth purchasing.

The book consists of a series of answers to a questionnaire sent out to many system developers, and literally a line of code devoted to the concepts presented by each interviewee. None of the ideas or answers by themselves will provide you with anything near a complete trading system, making the title misleading. In fairness, it's probably wishful thinking to expect more.

On the upside, it's been over a decade since the release of the book, a few of the systems have stood the test of time, and the basic logic behind the ideas could set you on the path to a profitable system.

Follwing are a few notes:

* Many use similar principles as the core of their system logic - buying higher highs

* Most count winning % as the least important aspect to a trading system, pointing to drawdowns and number of trades as more important metrics

* Several use SP trading systems, and although perhaps due to the date of the book, look at no less than 15 minute
bars and most 45 minute bars and higher. the interviewees say there is too much noise in 1-5 minute bars

* Many use very few parameters that can be optimized or curve fitted to past data

* The constant refrain is the simpler the better

* most build on the work of others and few are totally unique

If you are a beginner, it is a book for your starting. Many basic trading system concept are introduced. But you will find the concepts introduced are very superficial and hard to find any mysterious secret system in the book.

I found Joe's book to be extremely helpful in getting into the minds of some top traders. I have found in my own trading that one good idea can be worth thousands of dollars in profits(or avoided losses for that matter). One of the easiest ways to develop success at anything that you do is to find out what the pro's are doing and then try and copy them. Joe's book sheds light on the processes the pro's use to develop trading systems and will help you on your journey to developing your own successful strategies. Get two copies, one for your library and another for the people that will inevitably ask to borrow yours.