Mechanical Trading Systems

Mechanical trading systems

Mechanical trading systems combine the the certainty of algorithmic trading without the need for programming knowledge

mechanical trading systems bridge the gap between pure discretionary trading and full  on automated algorithmic trading systems

Whilst for short term  day trading  algorithmic trading may be essential for longer term swing trading of forex, commodities or indexes mechanical systems are often just as practical.

Mechanical trading systems are often referred to as "evidence based" systems because they can be fully back tested and therefore provide evidence  that the methodology does work and has worked over many years of historical data.

They overcome the problems that we have with discretionary systems which is that different people trading the same discretionary system can have different results depending on their individual interpretation of the rules. With mechanical systems and algorithmic systems the rules are clear and precise and hence everybody trading them will get identical results (excluding slippage and commission).

Almost all commodity trading systems are mechanical systems. 

View the video below for an explanation of the differences between discretionary, mechanical and fully automated trading. Also revealed are the full rules  for a simple trading system that made $80,000 in just two years trading a single contract with no compounding.

Use the play and pause buttons at the bottom of the tablet to play this short video

To view performance results for some of our mechanical and algorithmic trading systems go to the Automated Systems page