G Code Review – Steve Copan

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  • #783
    ReviewTeam
    ReviewTeam
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    G Code Review – Steve Copan

    Click below to visit the website

    Key Info

    Publisher:  Agora
    Cost:  £197 with a 60 day money back guarantee
    Review Date:  June 2010

    What It Says On The Website

    Surprising introduction “Once you know this code, you’ll hardly ever need to trade again”. The system could reward you with “£35,000 – £40,000 (trading £10 a point (expect up to £8,000 trading £2 a point)) a year in your spare time, by tapping a few keys two or three times a month”. And a rather bold statement, “I’ve finally cracked the holy grail of investing … a hidden code that dictates EVERY stock market movement and has made me – a former engineer – £1.2 million over the past 10 years”.

    The invite to this system is not open to everyone, “No novices, no dreamers and no halfwits” allowed. It’s a system for “busy people who want to trade as little as possible”, perhaps “once or twice a month at most and place trades that almost always have to pay out”. This system may trade only 34 times a year, or even less, but takes just minutes a day to check if there is a signal, or not.

    The upfront requirements for this system entails that “you need a decent grasp of the stock market” and “you must be prepared to put 30 hours of work in whatever your experience”. This entails reading the guide, re-reading it and getting used to spotting the signals.

    Golden ratio (Fibonacci) dictates the spaces between almost everything from the gaps between your DNA molecules to the distance between your limbs to the space between stars and galaxies – “It occurs everywhere in nature, even in the stock markets”. This is the basis of the G-Code system and it is all fully explained in the manual.

    Steve Copan has had many offers in the past to reveal this system but turned them all down, “this secret has made me well over £1.2 million since I discovered it, so I don’t need any more money”. He was convinced to do so only when he was assured it would only be open to people who knew a bit about trading and the stock market, and that there were no free gifts or stupid claims associated with the system.

    The system is provided with a 60 day no obligation guarantee, backed by Agora.

    The Material

    One deliverable, the 95 page Golden Ratio (The G-Code) Simple Trading Technique by Steve Copan. Steve originally developed and released, to the general public, the Market Matrix, back in 2004. An update was written and published in June 2008. The G-Code is a “book of simplified techniques … to make it as simple as possible to help the beginner start trading with confidence and even give something to existing traders to think about”.

    The basics section of the manual covers bar charts, Fibonacci retracements/extensions (the basis of the G-Code system) as well as Stochastics. These are all discussed at just the right level to set the tone for the two strategies that make up the G-Code system itself.

    Stochastic Strategy – Almost 30 pages to explain this strategy, although it is very well explained. It starts with the theory, explanation and then Entries, Stops and Targets. This is then followed up by stepping through 6 months worth of S&P Daily charts (from October 2008) detailing each potential and actual trade. It does come across as rather complicated and may seem daunting to some on first read and to be honest we had to read through a couple of times. In the end though, together with the one page summary and flicking through some charts ourselves, we had a pretty clear picture of the strategy.

    ISD Triangle Strategy – Steve has taken an already familiar and popular strategy and made it his own. This strategy is less complex than the Stochastic strategy but nonetheless will also require at least a second read through. Again, well explained with many examples to compliment the theory and logic behind the strategy. The one page summary is again useful when walking through charts on your own.

    The System

    Two strategies that although well documented, will seem complicated and daunting to some. However, as Steve suggests, some time commitment is needed here, he suggests 30 hours but we doubt it requires that long. All in all about 3 or 4 hours should suffice to run through the manual a couple of times (maybe three), print off the summary sheets and flick through some charts looking for the signals. A few notes of our own and we were satisfied we had a reasonable grasp of both strategies.

    Both strategies are 100% mechanical, Set & Forget and are operated at the same time, once a day on the S&P Daily time-frame. Entries, Stops and Targets are crystal clear and a couple of minutes each day is all we needed. We placed our trades around lunchtime (UK), plenty of time before the S&P market opens. Straight forward once you have a grasp of the strategies.

    Can It Work

    As these strategies are easy to apply and we traded the S&P Daily time-frame our first step was to back-test a few months worth of data. We back-tested from March – May 2010 and then traded June on a real account. Our results are detailed below:

    Strategy 1 (Stochastics) – 13 trades, 7 winners and 6 losers – Net return of around 9% assuming a 3% risk per trade.

    Strategy 2 (ISD) – 2 winning trades and 1 loser – Net return of around 2%, assuming a 3% risk per trade.

    So, just 16 trades in 4 months, however, a profit is a profit and for just a minute or two each day, cannot be sneezed at.

    As we like boring, slow, easy to execute mechanical systems, we are going to continue with this one for another month.

    If in the meantime if there is sufficient interest we will gladly open a Live Trading Room, at least for the period during which we will be trading this system.

    We will report back at the end of July.

    Support

    Excellent, response within 24 hours, courteous and great attention to detail.

    Summary

    PRO’s
    • Another system which ticks a lot of our boxes, 100% mechanical, Set & Forget, minimal time commitment and profitable (over the period we back-tested and traded).

    CON’s
    • Beginners may struggle, they may not, we just feel this should not be the first system you ever decide to try.
    • May not be enough action for some.

    Do remember, your comments are important – If you have used or decide to use this system, please contribute to the community by reporting back your findings.

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    #860
    ReviewTeam
    ReviewTeam
    Keymaster

    Systems For Traders had to be rebuilt in 2013

    This is a selection of key posts and comments from the original forum prior to the rebuild

    Carlosrd

    16-Jul-2010

    Just thought i’d give my opionion. I have Steve Copans ‘Nexus’ book (basically the old school G-code book with horribly printed text and ugly diagrams), which was copy righted from 1997-2009, hence why in 2010 he has released the G-code book. I have been looking at it uses within currency trading and obviously as there are more options which currencies hitting the magic high and low ratios, it seems it can be more profitable as it has stated than just trading on the S&P. I have look at 18 different currencies (excluding the euro, due to the eurozones current situation) and over the past couple of months, steve copans code definitely works around 85% of the time. I dont like to trade indices due to their possible high volatility as per the wall street crash on the 6th of may. All in all I recommend it, however I do not like the fibboranci retracement on basing your stops and limits on with currencies, I believe a bit of common sense is needed to determine when to take your profits and losses.

    ReviewTeam

    30-Jul-2010

    We are still only trading the S&P Daily time-frame and our results for July are as follows:

    Strategy 1 (Stochastics) – 5 trades, 3 winners and 2 losers – Net return of around 1% assuming a 3% risk per trade.

    Strategy 2 (ISD) – 1 winning trade – Net return of around 2.5%, assuming a 3% risk per trade.

    So, quite a high number of trades in July for G-Code with a net profit of around 3.5%.

    Continues to be boring and slow. But it is easy to execute and it is mechanical, we will continue another month and hopefully if we get time get round to looking at some Forex pairs too.

    We will report back at the end of August.

    ReviewTeam

    01-Sep-2010

    We still only managed to trade the S&P Daily time-frame and our results for August are as follows:

    Strategy 1 (Stochastics) – 5 trades, 2 winners and 3 losers – Net loss of around 2% assuming a 3% risk per trade.

    Strategy 2 (ISD) – 1 winning trade – Net return of around 2%, assuming a 3% risk per trade.

    A break-even month for us using G-Code.

    This means now, over a 6 month period with a mixture of back-testing and live trading on the S&P Daily time-frame we are up 17% taking both strategies into account. This is just short of 3% a month based on us risking 3% of account balance per trade and does not include any form of compounding.

    So, although G-Code seems to have an edge, it does seem slight. If we were to consider taking this further we would expand it to at least back-test some Currency pairs. If these proved profitable on back-testing this is a strategy that may suit some given those extra instruments to trade.

    Apologies to all we did not get a chance to thoroughly back-test any of the Currency pairs, it was just a time thing. We were a little reluctant as we were wary that the system is also only yielding a very slight return on what is it’s headline instrument, the S&P.  We will not cease coverage of this product.

    lowrisktrader

    16-Feb-2011

    A quick question on risk management for the ISD strategy.

    In the ISD strategy you must place 3 trades (i.e. 2 sell + 1 buy or 2 buy + 1 sell). When the sell or the buy trade is triggered you should cancel the opposite trade.

    How do you calculate the risk of the trade to calculate the stake size, given a 2% risk per trade? Do you assume that one of the trades will be cancelled and therefore you calculate different stake sizes for the buy and sell trade? Or do you calculate the total risk of the 3 trades and then calculate: 2% / total risk.

    For example:

    Assuming 2% of balance is £100

    Sell 1 – risk 40 pips,

    Sell 2 – risk 40 pips

    Buy – risk 50 pips

    Do you calculate the stake:

    1) Overall risk assuming that all 3 trades can be triggered: £100 / (40+40+50) = £ 0.77 / pip

    2) Assuming that only buy or sell will be triggered and the opposite trade will be cancelled:

    Sell trade: £100 / (40+40) = £ 1.25 / pip

    Buy trade: £100 / 50 = £ 2 / pip

    It worth to mention that I work full time, so I can only cancel the opposite trade in the end of the day. That’s the reason why I thought there is a risk that all the 3 trades could be triggered during the day.

    Thanks

    ReviewTeam

    16-Jul-2011

    We applied Option 2 – We used IG Index and when we got an email we knew we had to cancel the opposing trade(s) – Hopefully technology will allow you to do the same – Remember – You can also call them if you do not have access to a smart phone.

    Rugby Trader

    19-Feb-2011

    I’m trading the inside day method. i’ve changed it slightly though. i’m using a 38.2 stop rather than 61.2. reduces the risk, improves the percentage return. makes a huge difference to the figures. also when price hits target 1, i take half the trade off and move the SL to entry price +1.

    lowrisktrader

    07-Mar-2011

    Just the other day I realised that I was not using the 61.8% fib level for the stop, I was using the 38.2%. In the metatrader when I was setting the targets I was using the 138.2% and 161.8% extensions to set the target and at the same time using the 61.8% to set the stop. Just recently I realised that in doing that the stop was only 38.2% far from the entry price.

    I did a quick check on my journal and concluded that it wouldn’t have made any difference in my losses. All the trades that were stopped would have been stopped even with the wider stop. So, like Rugby I’ve also changed the strategy to use a 38.2% stop and I believe it improves its r/r.

    Rugby Trader

    08-Mar-2011

    Hi Lowrisk,

    For my entries i add on 5 to the highs and lows of the outside bar, but add on the spread to the buy side as i take my prices from a bid chart.

    I’m also going to start investigating what would happen if i put the SL at the 23.6% level to see if the R:R can improve further.

    Rugby Trader

    10-Mar-2011

    Just want to update.

    Trading this system takes a little bit more time than I would like it too.

    Scanning the charts is pretty quick. It’s the order entering into SLM and also alerts into IG which take a bit of time.

    For each instrument you need to enter 4 orders, 2 on each side of the bar for target 1 and 2 and then you need to enter price alerts into IG so you know when one set have been triggered and you can cancel the other.

    Once an order has been triggered you need to set a new price alert in IG so you can move target 2 SL to +1.

    But still, not a huge amount of time 10-20 mins depending on how many orders there are.

    I’m also going to do some backtesting in the next couple of weeks on a stoploss at the 23.6% level.

    There are quite a lot of trades during a month so I’m hoping it can generate 3-4% a month as a minimum, it might be a bit of rollercoaster during the month, but I’m hoping it would all smooth out, which would make me a happy chappy indeed.

    If it keeps going well then towards the end of April when I’ve completed 3 months of live trading, I’ll move upto 2% per trade of my full bank (1% on target 1 and 1% on target 2)

    Also, some people might point out why not just lump the 2% on target 2 as you will make more.

    I would make more, but target 1 wins so often it’s a great psychological booster and stops me messing with the trade while it’s in action.

    So I make more (personally) doing it this way as it stops me meddling.

    So fingers crossed it doesn’t balls up as it’s still early days

    Rugby Trader

    11-Apr-2011

    Hi Review Team,

    I currently only use the Majors, Gold, Silver, the 2 crudes, UK100, SP500 and Dow Jones.

    I’ve left all the minors for the time being. I think the correlation is too great, but i may investigate further down the line.

    Anyway, I’ve taken a couple of weeks off from trading this system, no particular reason, just being a little lazy. I’m going back to paper-trading as i’m now testing another variant. A stop-loss at the 23.6% level, see what kind of returns that provides me with and how it affects the win:loss ratio.

    I will report my results when I can.

    ReviewTeam

    11-Apr-2011

    Rugby – Thanks as always – This is obviously of interest to us as well as others. Look forward to your “tweaking” updates as and when you get time to report.

    Thanks in advance.

    lowrisktrader

    14-Apr-2011

    Thank you for the update Rugby.

    Regarding the fib levels, so far, looking at my stats it seems that most of the trades that were stopped with the 38.2 stop would also have been stopped if I had used a 61.8 stop, so I think we need to look at how the stats stack up for 23.6.

    Looking forward to hearing your views.

    Rugby Trader

    13-Apr-2011

    Yes, I found that often if it hit 38.2% it would usually go and hit the 61.8% level, so it’s pointless having a 61.8% stop.

    Also as you were using a bigger stop often the R:R ratio was less than 1 for target 2 and very small for target 1, so a smaller stop obviously will improve R:R and therefore overall returns.

    Whether 23.6% is better than 38.2% will be a tougher question. A lot of trades shoot straight through entry and target 1 & 2, but there are a number of trades that trigger and stay underwater or around entry, so some more of those will get knocked out.

    It’s whether the improved returns outweigh the additional stop-outs that happen because of the tighter SL.

    If the return is only marginally or a bit better for 23.6% than 38.2% then I may stick with the slightly lower return on 38.2 as the win/loss ratio will be psychologically better for me.


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