ProTrader 123

ETF Based Trading Systems for Main Street
 
 

RUT Model Performance 1991-2013


 
 

What is ProTrader 1-2-3?


ProTrader 1-2-3 was created out of frustration. Like many new traders we looked at a range of trading services and sadly found nothing that worked. So we set about to create our own system. We believe that what we've developed is better than anything out there today. It is based on sound system analysis (treating the market or an individual ETF as a system) and optimization for maximum profit/gain. Fundamentally, the system calculates, day by day, a pivot point for a market or ETF, where the pivot point (or break-even point) is the price at which the underlying market or ETF has a 50-50 chance of going up or going down.

Some Basic Principles:

  1. No Day Trading. I have a life and you should too. Staring at a computer screen all day is not a life, so the system is designed to make at most 1 trade a day at the Market Close.
  2. No Emotion. The system takes emotion and second guessing out of the process. It's simply based on probabilities and historical performance.
  3. Diversification. Currently ProTrader 1-2-3 generates signals for equities (SPY, IWM, QQQ), bonds (TLT), and precious metals (GLD) so you can build an overall diversified trading system that suits your needs, risk profile, and trading goals.

How Does it Work?

Each day after the market closes we run a set of computer models for each ETF to generate a set of pivot points for the next day's close. Typically these runs complete by 9PM ET and are posted to the website.The pivot points are then used to direct a trade (if necessary) for the following day's market close. This can be done with a conditional MOC (Market on Close) order so it can even be automated.

 

Why SPY, IWM, QQQ, GLD, and TLT?

SPY in particular should be the core ETF you trade along with IWM and QQQ. For one, SPY is one of the most traded ETFs daily so it's quite typical to see $0.01 bid/ask spreads as a result of that liquidity. Why pay for your broker's house in the Hamptons? To add diversity to the equity side we also have models for the Russell 2000 and NASDAQ-100. 

 

How often do the models trade?

That depends a bit on the overall market behavior but it's not unusual for the system to generate Long or Short signals that last 10-20 trading days. If you would like to see the full 24 year trading history for the SPX, RUT, or NDX models simply email us at support@protrader123.com.

 

Can I use leveraged ETFs?

YES. However, don't expect a 2X ETF to produce a 2X Gain, you should expect something more like 1.7-1.8x. All leveraged ETFs and in particular leveraged inverse ETFs have slippage and are limited by daily rebalancing. Of course there's no free lunch so if you choose to use leveraged ETFs you'll also experience much more volatility in your trading account.

 

Can I use this with an IRA?

As Long as your IRA account allows trading ETFs and inverse ETFs the system will work as designed for any trading account.