Confession

<body topmargin=0 leftmargin=0 marginheight=0 marginwidth=0> <table cellpadding=0 cellspacing=0 border=0 height="100%"><tr> <td valign="top" width=180 BGCOLOR="#003333" TEXT="#F7F7FF" background="53cc6c00dduajq.png"> <div> <TABLE BORDER="0" CELLPADDING="2" CELLSPACING="0" WIDTH="95" BORDERCOLORLIGHT="#C0C0C0" BORDERCOLORDARK="#808080" FRAME="BOX" RULES="ALL" HSPACE="0" VSPACE="0" > <tR> <tD VALIGN=TOP HEIGHT= 46 WIDTH="91"><IMG BORDER="0" SRC="1x1.gif" HEIGHT="46" ALIGN="bottom" WIDTH="91" HSPACE="0" VSPACE="0"></tD> </tR> </TABLE></div> <bR> <bR> <bR> <bR> <bR> <div> All truths are easy to understand once they are discovered;  the point is to discover them.</div> <div> ---Galileo</div> </td> <td valign="top" BGCOLOR="#FFFFFF" TEXT="#080000"> <div> <FONT SIZE="7" COLOR="#003333" FACE="Edwardian Script ITC" >Whole Earth Forecaster</FONT>     <A HREF="index.htm" TARGET="_top" TITLE="Whole Earth Forecaster"><U>Home</U></A></div> <div> <A HREF="id19.htm" TARGET="_top" TITLE="FAQ"><U>FAQ</U></A>   |   <A HREF="id25.htm" TARGET="_top" TITLE="Economics"><U>Economics</U></A>   |   <A HREF="id26.htm" TARGET="_top" TITLE="Weather"><U>Weather</U></A>   |   <A HREF="id28.htm" TARGET="_top" TITLE="Behavior"><U>Behavior</U></A>   |   <A HREF="id27.htm" TARGET="_top" TITLE="Natural Disasters"><U>Natural Disasters</U></A>   |   <A HREF="id39.htm" TARGET="_top" TITLE="The Environment"><U>The Environment</U></A></div> <div> <A HREF="id45.htm" TARGET="_top" TITLE="Evidence"><U>Evidence</U></A>   |   <A HREF="id36.htm" TARGET="_top" TITLE="References"><U>Bibliography</U></A>   |   <A HREF="id41.htm" TARGET="_top" TITLE="Products"><U>Products</U></A>   |   <A HREF="id48.htm" TARGET="_top" TITLE="The Berg Timer Method"><U>The Berg Timer Method</U></A>   |   <A HREF="id44.htm" TARGET="_top" TITLE="Contact Me"><U>Contact Me</U></A>   </div> <bR> <bR> <div> Confession of a Retired Trading System Vendor and a Challenge to All Trading System Vendors to Honestly Answer the Question:  "Why are you selling your system?"</div> <bR> <div> <I>My honest answer and what I'm going to do about it.</I></div> <bR> <div> October 2, 2005</div> <bR> <div> I don't use my website for expressing personal views.  However, please allow me to use this one page to tell you about something which I have come to realize.  I have been developing trading systems and providing trading advice for options, futures and stocks for about 25 years now.  I have traded the systems I've developed myself, but mostly I would lose with them . . . not because they weren't good but because I couldn't follow my own rules.  I would always find some way to mess up.  So time and again I would develop even more new systems, thinking that I'd be able to follow the next one myself.  It never happened.  More systems, more trouble with the discipline to follow them.  </div> <bR> <div> That is my particular answer as to why I sell my systems.  And, indeed, that is the best question you can ask any system vendor, 'Why are you selling your system?'.  You'll hear reasons like 'I need the money', or 'I just want to share it with everyone', or 'I don't have the time to trade', or 'I don't have any money' . . . many of which sound like perfectly legitimate reasons for selling them.  Well, they aren't good reasons.  Why not?</div> <bR> <div> <IMG BORDER="0" SRC="Symb075c00b700f000000000.png" HEIGHT="16" WIDTH="24" ALIGN="bottom" HSPACE="0" VSPACE="0">"I need the money from selling it".  That's easy, why don't you just trade the system yourself and make money from the system?</div> <div> <IMG BORDER="0" SRC="Symb075c00b700f000000000.png" HEIGHT="16" WIDTH="24" ALIGN="bottom" HSPACE="0" VSPACE="0">"I want to share it, more traders using the system won't hurt it".  Ok. And so you are giving the money you make to charity?  If not, that doesn't figure.  And more traders using the same system WILL hurt the system.  If you found a buried treasure would you say, "Hey, everyone, come share, there's enough for everyone!"?  No, I don't think so.</div> <div> <IMG BORDER="0" SRC="Symb075c00b700f000000000.png" HEIGHT="16" WIDTH="24" ALIGN="bottom" HSPACE="0" VSPACE="0">"I don't have the time to trade it".  How did you find the time to develop it?  If it's good, quit your day job and trade it.</div> <div> <IMG BORDER="0" SRC="Symb075c00b700f000000000.png" HEIGHT="16" WIDTH="24" ALIGN="bottom" HSPACE="0" VSPACE="0">"I want to trade it but I don't have the money to get started".  You can't find a couple thousand dollars to get started?  That's not a good reason.  Get a job, save some money or borrow some money.  </div> <div> <IMG BORDER="0" SRC="Symb075c00b700f000000000.png" HEIGHT="16" WIDTH="24" ALIGN="bottom" HSPACE="0" VSPACE="0">And my own reason, "I don't have the discipline to follow it myself".  Well, then, GET IT!  </div> <bR> <div> And that's what I'm going to do.</div> <bR> <div> Maybe there is something in the kind of talent required to develop good systems, that prohibits the developer from actually using it.</div> <div> Wouldn't that be a cruel joke of Nature?  Perhaps it's true.  But I don't think so.  I think I have self discipline.  I quit smoking, I don't do drugs, I don't drink too much.  I am able to push myself to reach the end of a goal, whether it's research, self improvement or some other project.  So why can't I extend this dedication and self control to trading?  Perhaps it's the fear of being wrong.</div> <div> Maybe it's perfectionism.  Perhaps it's being too close to the system that you developed, knowing the weaknesses of it, and then trying to second guess it all the time.  Whatever it is, I have not been able to overcome it.  Thus, that is why I sold systems and did not trade them.</div> <bR> <div> But that is going to change.  </div> <bR> <div> Only now, after 25 years of this, have I completely faced it.  And I think that has helped me to understand why it is that I am not able to profit from my own systems.  Perhaps this will help you to understand a bit better the situation of system vendors --- that they have all kinds of motivations and reasons for selling something that, in all logic, they should just use themselves.  After all, the big question is, 'If it's so good why don't you just trade it yourself?'.</div> <div> The answer to that question is, well, I answered that for myself above.  And no, it's not an answer, it's an excuse for something that's 'just not right'.  In fact there is no 'legitimate' reason why anyone would sell a good short-term system.  A longer term system, maybe yes, since it can't be affected as much by overuse.  But daytrading systems?  No excuse.</div> <bR> <div> It is not logical to sell something which one can simply use for oneself.  Only two things can happen if one sells systems:</div> <bR> <div> 1)  the buyers of the system use it and profit, the system becomes overused and the owner never realizes the full potential of the system for himself.  That's not good.</div> <bR> <div> 2)  many others use it and lose their shirts with it.  That's not good either.  </div> <bR> <div> So, realistically, I have finally come to realize that <B>it is not to my benefit to sell short-term systems or short-term trading advice any longer</B>.  It wouldn't make sense because of the two logical deductions above.  And that's why I'm writing this.  To encourage you to ask, 'why is this guy selling it?' next time you are considering purchasing a system or following someone's trading advice.  Really, system vendors are either dishonest (if selling something they know is bad) or not doing something in their own best interest (if selling something that's really good).  Either way, that doesn't make system vendors look very good does it?  And it took me only 25 years to figure it out!</div> <bR> <div> Wish me luck.  I am now on the System Vendor wagon and vow to always follow my own system's rules.</div> <bR> <div> May you reach all your own trading goals,</div> <bR> <div> Larry Berg.</div> <bR> <bR> <bR> </td> </tr></table></body>