This week we'd like to welcome back a regular guest of the Wednesday Newsletter.
When we last spoke, things weren't going so great. And the interview reflected that.
Since then, things have changed and how and why they've changed is the focus for this week's chat.
Scott Welsh (SW): Well, well, well. Fancy meeting you here, robot.
Heron (H): Did you not invite me here, sir?
SW: Shut up. We're here today to talk about your performance. When we last talked, you were pretty pathetic. Down 1.8% at the time, if I recall. Can you explain your awfulness?
H: If my memory is correct, sir, we previously discussed that in-discrepancy. The underperformance was due to some unforeseen glitches that were not caused by my programmed methodologies.
SW: You're a glitch.
SW: Let's move on. But since that pitiful time, you've done much better. Talk about how you've stopped being so pathetic.
H: As you know, sir, my performance is neither skillful or pathetic. I merely execute trades in the manner you've set forth.
SW: Whatever. If what you say is true, robot, then why weren't you profitable on my myfxbook for 2017? My testing said you should have made well over 20% for the year, yet you were about 1% down. Explain that!
H: Sir, you only started trading me on myfxbook at the end of May last year. The first five months were profitable in the aggregate and none of that was reflected in that total.
SW: But what about the rest of the year, idiot?
H: As has been mentioned, several full winning trades were missed due to disconnection to the VPS server and me being turned off.
SW: Fine. I get that. But what about November 12, 2017, huh? You lost over 5% in one day!
H: You are correct, sir. I did hit my full emergency stoploss on that day. I have hit my full stoploss, on average, 3.4 times per year since 2004. That is nothing unusual, sir. In fact, I am up 9.15% since that full stoploss.
SW: Way to slip that in. So you're saying that the big stoploss was normal, the myfxbook number was not for the whole year, and that connection problems combined with intermittently turning you off caused the performance to be far less than what testing showed?
H: Were there not times, sir, that you also overrode my programmed instructions and manually closed trades out before they were completed?
SW: [angry] Yes.
H: There were many times you manually closed trades out, weren't there, sir?
SW: [seething] Yes!
H: That would also cause a discrepancy, would it not?
SW: Just shut your stupid cake hole.
H: I do not eat cake, sir.
SW: I'm going to slap you until my fingerprints are worn off. Moving on! This year, 2018, I have not laid a finger on you, robot. No more user error or human error or whatever stupid phrase you want to use. I've left you alone.
H: I admire your restraint, sir.
SW: And how has this year gone?
H: I am positive for the year, sir. I am up 3.51%.
SW: But the testing numbers say you should only be up 1.1% for the year.
H: My live results should always be higher than the testing results, sir.
SW: That sounds arrogant. Why is that?
H: You know very well, sir. It is because you build trading cost estimates into all of the testing. In live trading, my execution is usually far better than the costs you've estimated.
SW: Okay. That's the first smart thing you've said this entire interview.
H: Thank you, sir.
SW: Let's wrap this up. In summary, 2017 would have been profitable had you traded untouched the whole year and that, when left untouched, your results are better than the testing. Just say yes and I'll send you on your way.
H: That is correct. But I do not go anywhere, sir. I only take trades.
SW: Good grief.
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Get the Heron Course here.
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