Successful trading need not rely on state-of-the-art technology. Visit the office of a successful Trend Follower and you are in for a surprise. Their computer technology is often out of date. It is not uncommon to see ten year old PCs and Macs running software long since abandoned by their short term trading counterparts. Trend Followers don't need speedy SPARC stations or top of the line Pentium machines. Why would you need a top of the line processor if your trade lengths exceed 3 to 6 months? The best Trend Followers do not physically watch their computer screens 24 hours a day. They often program the rules into older languages such as FORTRAN and BASIC. When buy or sell signals are generated, a bell sounds indicating it's time to place a trade. Many people are reluctant to face the truth that maximizing profits demands patience. People want to believe that big money comes from big excitement.
Old Time Technology
New traders and investors are often unaware of long term Trend Followers' continued reliance on various programming languages developed many years ago:
- System Writer.
- BASIC.
- FORTRAN.
Top traders still translate their trading rules into these programming languages. There are literally dozens of ways you can automate Trend Following rules.
The Omega TradeStation Debate
TradeStation is a good product. If you own it you can program Trend Following rules and save some time. Is it absolutely needed? No. The bottom line is that you have many choices in the tools you use to trade. But don?t kid yourself. Fancy charts, bells, whistles won't help you to make money. The reason why so many older methods of trading automation work well is because as a Trend Follower you have a longer time frame for decisions. The issue of purchasing the latest and greatest hardware and software becomes a moot point. If you are trading tick by tick day trading or arbitrage, you might need super computing horsepower, but trading correctly does not require an IBM S/390 number cruncher.
Software programs useful for trend following automation:
Computing solutions assist in the automation of Trend Following rules, but those same rules could be worked through with paper and pencil. Automation of rules and backtesting are the prime benefits of today's computing technologies. Computers allow for the leverage of your time and assist in making routine tasks systematic. But the rules themselves are still key.
NOTE: If you want to learn trend following techniques and systems through advanced home study and or seminars for all traders click here. If you want to learn about trend following trading in general there is one definitive text the bestselling classic "Trend Following: How Great Traders Make Millions in Up or Down Markets" by Michael Covel. If you want to learn about the most famous group of trained trend following traders, the Turtles and their teacher Richard Dennis, "The Complete TurtleTrader" by Michael Covel is the only complete biography (with all of the Turtle rules) available. Key introductions:
- Top Reasons to Be a Trend Follower.
- Can I become a trend follower?
- When the next crash happens will you be ready?
- The dead hand of safe bets.
- Trend Following preface.
- The Complete TurtleTrader preface.
- The Complete TurtleTrader afterword.
- On criticism.
- Meeting Mikhail Gorbachev: my journey.
- Influences.
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