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RC Success is one of several trading systems by Hong Kong developer Rickey Cheung, with through achieving a low drawdown and admirable YTD performance.

After running our semi-annual "What's your best system?" article last week, many investors were left with a few questions 1. What is RC Success? and 2. How did it get in third place on that list? The answers: RC Success is one of several trading systems by Hong Kong developer Rickey Cheung, and it placed third on our rankings with through achieving a low drawdown and admirable YTD performance. This month's System Spotlight highlights RC Success:

Who is the Developer?
Rickey Cheung is the developer of RC Success. Mr. Cheung has been studying the futures markets since 1985, and believes first and foremost that trading should be both enjoyable and profitable - or else why undertake it in the first place. He began focusing his attention specifically on S&P systems over the past 10 years, and came up with the basic building blocks for his systems, the "RC Models" in June of 2002.

In September of last year, Rickey started RC Trading Education, LTD in an effort to teach his methods and strategies to others in a one on one seminar type environment. He views his trading systems as a vehicle to prove the viability of the logic he teaches in his tuition based seminar products. Mr. Cheung graduated from the University of Houston in the United States with BS and MBA degrees, and has worked as president of Asian operations for a multinational corporation in Hong Kong.

How does it Work?
This section of the spotlight promises to be rather short as RC Success is a definitive "black-box" system, with the developer rather clear on the fact that the indicator(s) used are proprietary in nature and not disclosed. The developer is quite willing to tell you how it doesn't work, however, stating that it doesn't use any of the so called "popular" indicators such as moving averages, range breakouts, oscillators, support and resistance levels, and more. According to Future Truth's John Hill as quoted on the RC website, the system uses a "very unusual" indicator in its logic, and he has "not seen any systems that use similar indicators."

We do know that the system attempts to catch daily trends early in the move, and likewise identify and catch trend reversals early on. This type of action should result in some home run trades as the system enters near the low or highs of different moves, but the danger can be getting in to early and suffering losses if the market doesn't confirm right away.

Another attribute is that RC Success trades relatively infrequently, with no more than one trade per day. This is designed to reduce market exposure by limiting the time in the market and appears to have resulted in manageable drawdowns (11.5% in actual trading; ~20% in hypothetical backtesting). We have also learned that RC Success uses over 20 different strategies to enter trades, depending on what type of market environment is prevalent that day.

On the exit side, the system uses three different exits: a stop loss, breakeven stop, and MOC exit. The breakeven stop attempts to lock in profits by moving the stop to the point of entry once the trade has made five points in open trade profit. If the break-even stop is not hit, the system will attempt to ride the profitable trade to the market's close.

The system was designed specifically for the S&P futures and/or e-mini S&P futures market, and tested with TradeStation data back to just 2001 before out of sample testing back to 1998. While Rickey states it was not his goal when setting out to develop RC Success - the backtesting shows a system with a relatively high profit per trade, high winning percentage, and low drawdowns. RC's newest system, RC Miracles, actually tests better than RC Success, and is claimed by Mr. Cheung to be his best system.

Attain Comments:
Despite record low volatility in S&P futures so far this year which has proven to be a less than ideal market environment for several day trading systems, RC Success has held its own so far this year. Investors may be turned off by some rather exorbitant claims on the website - such as "Probably the #1 S&P DayTrading system in the World" - but the tone may be a case of some nuances being lost in translation. We'll give Rickey the benefit of the doubt, but either way, his passion for his craft shows through.

At the end of the day, the system looks good in its hypothetical backtesting and has performed admirably since Attain began tracking it in March of this year. Whether the relatively short track record can be replicated over the long term remains to be seen, but its its infrequent trading style and goal of high winning percentages should keep away any big surprises to the downside.

 

RISK DISCLOSURE

Whilst the contents of our web-site are based upon sources of information believed to be reliable, no guarantee, warranty or representation, express or implied, is given as to their accuracy or completeness. Neither the Company nor any affiliate, nor any officers, directors, employees (including RC) accept any liability or responsibility in respect of the information or any recommendations expressed herein which, moreover, are subject to change without notice.

The information posted in our web-site is not giving advice on any investment referred to in our web-site but is merely provided for informational purposes about training courses and the profile of RC only.

All the financial investments have risks and the risk of loss in trading futures contracts is substantial, even if the Students had completed the training courses conducted by the Company and/or RC.

DISCLAIMERS

No Advice: Information provided in this web site is not intended to constitute legal, accounting, financial, investment or tax advice, and should not be relied upon in any such regards. It is not intended to be a comprehensive or detailed statement concerning the matters addressed. Many factors unknown to us may affect the applicability of any statement or comment that we make on our web site to your particular circumstances.

Information in this web site does not constitute an offer to invite any enrollment of any training courses of the Company and/or its subsidiaries and affiliates and the directors thereof. The Company has the absolute discretion to accept any students of any training courses of the Company. Every user of this web site is still advised to seek professional advice before acting on any part of the information contained herein.

The Company expressly disclaims any liability for losses or damage, whether direct or indirect, special or consequential, incurred by any user of this web site. By accessing this web site, each user releases the Company and all related companies and their respective directors, officers, employees and agents from all claims and proceedings for all such losses, damages or consequences.

The information contained in this website is for general information purposes only. The information is provided by the Company and while we endeavour to keep the information up to date and correct, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the website or the information, products, services, or related graphics contained on the website for any purpose. Any reliance you place on such information is therefore strictly at your own risk.

The results of all kinds of the exercises and tests assigned by the Company and/or RC in the training courses (including but not limited to back-tests, paper trades and simulation exercises) cannot represent the results of real trading in whatsoever senses. The Students cannot rely on the results of such kinds of exercises and tests for any real trading. In Hong Kong, no advice on any investment shall be given by the Company and/or RC. The Company and RC shall not be liable for whatsoever loss and damage arising from the Studentˇ¦s own real trading by considering the training materials or strategies taught by the Company and/or RC.

 

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