Trading Systems

A trading system consists of a set of rules for viewing markets and making trades. The advantages of trading systems can be hidden when they become associated with trading platforms involving trade order submission and processing. A clarification of their roles can help explain the benefits of using a trading system. This can be done without identifying a particular platform or system. Once the platform infrastructure is isolated, a brief look can be taken at why a trader can benefit from a trading system.

Online trading platform : Market prices and making trades

An online trading platform consists of the infrastructure for viewing market prices and making trades. While platforms make use of user provided hardware and the internet itself, platforms consist of software linked to a database while displaying price quotes, enabling order entry and routing orders to an exchange. A platform of software and order routing services is provided by many brokers. It often includes programmable charting software that allows a user to select from an array of formats for price, volume and technical indicators. Links to real time databases are used by day traders while free delayed quotes are quite adequate for position traders who analyze data after the markets close to minimize the emotional stress of changing prices. Platform software saves time and reduces errors by automating repetitive tasks.

Copy Cat or How to Use a Successful Trading System

How many books have you read about successful traders? How they did this or that and made a fortune and are still doing it. You say to yourself, “I’m going to follow his method and get rich”.

So you subscribe to his newsletter (they all have one, $250) and buy his course on CD Rom ($495)and next time he is anywhere near you attend his seminar with a $500 discount for only $2495. You do understand you must do exactly as he does and you try your best to follow the directions, but for some reason you still are not making money. At least you are not losing as much as you did before (I hope).

Go look in the mirror. You are not Richard Russell, Richard Wyckoff, Bill O’Neil or any one of the great gurus of the market place. Each one of them has devoted every minute of his life to understanding the market. Each one is very successful and each one has a completely different way of approaching trading. Can you copy any one of them? It is very doubtful.

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