I. School’s (almost) out sale
School is or almost is out for the summer! Buy the NeuroShell Trader Professional, NeuroShell DayTrader Professional or any of our Add Ons so you can make enough money to take your kids on a great vacation or for a gift for the graduate. If you buy from now until the end of May, take 15% off of the list prices.
If you already own the NS Trader or NS Trader Professional, and you upgrade in May to either the NS Trader Pro or the NS DayTrader, we’ll give you 15% off the upgrade price!
To be fair to our business and science customers, we will extend the 15% discount to the purchase of the AI Trilogy.
Act fast because the sale ends on May 31st!
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II. Real Traders – David Buffalo
David Buffalo is a chemical engineer by trade, but he has been trading part time since 1978. He was so interested in the financial markets that he left a good manufacturing job to help another entrepreneur start a brokerage firm in 1993. In 1995, he decided to cut loose all ties and start trading on his own. Though he started an export business in 1997, the business began to die about two years ago. From that point, he decided to trade full-time and scale up his operations. He began by trading bond futures exclusively, but then shifted into stocks to lessen the volatility and constant attention that futures trading requires.
For a while he swing-traded using the knowledge of patterns and signals he had developed, but he felt he needed more consistency. He also wanted to determine which of his patterns were working the best. He wanted a mathematical model that provided him with more safety.
Before the big bear market started in 2000, David was one of those smart enough to liquidate. “That’s when I decided to get serious about neural nets,” he said. “I decided to go with Ward Systems Group because you guys have been in business and doing neural nets longer than anyone else.”
David purchased the NeuroShell Trader Professional and started using the Prediction Wizard to build his neural nets. “I now make about $400 per day on a total average investment of $40,000,” he is not bashful about pointing out. “I get as many as 85-90% of my trades right.” Not a bad daily return indeed! This is doubly good when you consider that Dave only goes long and it has been a largely sideways market. Moreover, Dave is managing his IRA account, so his funds increase tax deferred. Dave also manages a separate taxable portfolio of long-term positions. All of the buy points are generated using NeuroShell Trader Professional and assisted with common sense stops.
Dave has devised a clever series of inputs which even we do not really understand, but basically, he describes a set of patterns using boolean and > and < rules, and then lets the optimizer find the rules which make the most profitable inputs to his nets. He uses Fibonocci retracement levels in his descriptions. When we asked him why he didn't use the Fuzzy Pattern Recognizer add-on, he said, "I didn't want to change what I'm doing just yet, because it's working so well. But I plan to experiment with that soon." Dave's first "secret" is that he selects stocks that are basically sound fundamentally. He filters out any stock with fluctuating earnings, and winds up building nets on sectors that are poised to move up anyway. Then Dave does what he calls a "common sense" analysis to determine if he likes the resulting signals and nets. First, he looks for around 70% correct trades. He also looks at the win/loss ratios, hoping to find a ratio of greater than 1.5/1.He then verifies that the signals match the patterns he has developed. He isn't hesitant about throwing out models that fail to meet his criteria. "I'm not looking for the perfect model", Dave says flatly. We asked Dave to describe his nets more. "I predict the change in open 5, 10, or sometimes even 15 days out. I use full optimization to select about 5 inputs and the corresponding best pattern parameters. I use two walk-forwards of about 6 months each, and I train on about 5 years of historical data." Do you override your nets if they look like they aren't working?" we asked. "Sometimes, if there is some more attractive stock and model to put my money in," was the reply. "I have my own mental trailing stops." We asked Dave if he planned to do any short selling. "Nope, I'm going to use puts - that's my next step," he said confidently. And after our interview with David Buffalo, we are certain he will more than double his rate of return when he starts using options. ******************************************************* III. AI College News We are planning to start another online session of the Advanced Class for NeuroShell Trader Professional and DayTrader Professional. It will probably run sometime during the months of June and July, so plan accordingly. Watch for dates on www.aicollege.com. ******************************************************* IV. Emergency Notice for Quote.com users PLEASE HEED THIS NOTICE IF YOU WANT TO CONTINUE GETTING DATA FROM QUOTE.COM!!! Quote.com has recently made some major changes to their interface. This week we found out that all users will have to load a new version of that interface and install it on your system. You must do this soon - OTHERWISE QUOTE.COM THREATENS THAT THE OLD INTERFACE WILL NO LONGER WORK! We had very little advance notice ourselves, and this is not the time table we would have chosen had it been up to us. Although Quote.com has been talking about interface changes for some time, few real details have emerged until lately. We have tested the new interface these last couple of days and it seems to work with both NeuroShell DayTrader and Qcharts. However, we have noticed a number of problems connecting. Several times we have seen it take over 10 minutes to connect, or not connect at all. It seems to repeatedly try different servers without success. We hope that these problems have been due to temporary server problems and not problems in the new interface they have built, but we aren't sure. They probably aren't sure either. They are definitely not NeuroShell Trader issues. Nevertheless, none of us have a choice - we are being forced to switch. Here is the link where you can download a new ContinuumClient.dll, Quote.com's interface. It is actually an install program that replaces all copies of the DLL in your system. We had no problems downloading and installing it. Paste the following URL into your Internet explorer: http://www.quote.com/qcdownload/ContinuumClientUpdate/SetupContinuumClient.exe After you have downloaded and installed the new DLL, we suggest that you erase the following file from your NeuroShell Trader folder before you bring up NeuroShell again: ContinuumClient.ini If you previously used a program from Ward Systems or other sources that rearranged the ini file in the order of the best responding servers, we suggest that you do not use it until you see if the new logic built into Quote.com's new interface allocates servers better. Ours was called the QuoteComServerSelector (a.k.a. the "pinger"). The new DLL logs which program is connecting to their server. Quote.com has in the past hinted at reducing service to programs which use too many resources. We would therefore like to caution our users not to load more historical data than they really need, and try to refrain from loading large amounts of historical data during day trading hours. We remain committed to introducing new sources of intraday data feeds so that our users can have a choice in the data that they purchase. ******************************************************* V. Developer adds NeuroShell Trader to his shingle Those of you who frequent the NeuroShell Trader forum know Steve Kratochvil as a NeuroShell Trader expert who has been generous and helpful in his advice to newer NeuroShell Trader users. Steve also owns a software development firm called Ontologic Systems, which has just decided to offer custom software development for NeuroShell Trader, Trader Professional, and DayTrader Professional. This will be a great asset for those of you how would like to expand NeuroShell but don't feel your programming skills are good enough. Steve has already made a number of extensions for use in his own trading, and we are confident he can help you too. Ontologic Systems will offer software development services for NeuroShell customers in the following areas: Indicator Construction - Custom indicators based on your theories or formulas. No matter how complex the indicator, we can build it for you. DLL Programming - Custom programming to reduce the size of your charts and improve performance. Complex trading systems and signals that go beyond the abilities of the indicator wizard are easily programmed into the logic of a DLL. Code Conversions - Converting code from other trading platforms into indictors or DLL's is simple with Ontologic Systems custom development. System Integration - Integration is key to translating your system to the real world. We can do that for you. If you have a need to share information between NeuroShell and other applications Ontologic Systems can build your bridge. Ontologic Systems is offering these services to help you leverage your NeuroShell products in the way that you envisioned them. Contact: Ontologic Systems Steve Kratochvil 1043 Tahoe Trail Lilburn, GA 30047 Toll Free: 1-877-530-3697 Local: 770-638-9990 Email: development@ontologicsystems.com Web Site: www.ontologicsystems.com ******************************************************* VI. No more newsletters in the future? No, we aren't ending this newsletter. But you will think we did if you change your email address and don't send us your new one! *******************************************************