BarroMetrics Views: Larry Williams
The to-and-fro between Paul and Steve has created quite a storm of interest. So much so, that I have decided to add my comments.
Like trading, in this sort of situation, I seek to establish the facts. For this reason, I shall be separating my observations into two parts:
- Whether Larry Williams can trade?
- Whether his trading systems produce a profit?
Can Larry Williams trade?
We have no information after 1990. But, before that, we have the following:
- ‘In Winner Take All’, William Gallagher documents that, in 1987, while Larry was winning the Robins Trading Championship (profit USD $902,599), his managed account lost – USD $6,122,281. He was fined by the CFTC (See http://www.jurikres.com/snake/lawsuits.htm).
- In July 1988, Larry commenced the Larry Williams Financial Strategy Fund. By October 1989, Futures Magazine reported that the fund had lost more than 50% of its equity.
- In March 1989, Larry commenced the World Championship Fund. By May 1990, the fund also lost more than half of its original equity. (see http://www.jurikres.com/snake/lawsuits.htm)
Do His Trading Systems Produce a Profit?
This question is harder to answer. The reason is, the profitability of a system is dependent upon the trader as well as the system. Consequently, we need to look at the indirect evidence.
From me, indirect evidence is provided by Larry’s peers. In this regard, there is no doubt in my mind that the best minds in our industry support his systems.
In Larry’s Hall of Fame page, we see testimonials by well-known traders. I am acquainted with some of the personalities on that page. From personal experience can say that their testimonials are .genuine.
Are there other suggestions to the contrary?
Yes, we have the very vocal assertions by David Burton. (See http://www.schoolofgann.com/frauds.aspx).
However, if you read through David’s writings, there is little evidence in them pertaining to the viability of Larry’s systems. The feud between David and Larry seems to have been started by Larry’s comment in the May 2004 issue of Traders Magazine:
“”I am not wild about the technical stuff. I believe that most of it is not useful and some of it actually fraud – like Gann and Elliott.”
So far as trading is concerned, it is difficult to state whether or not Larry can, today, trade. After all, his disastrous venture into funds management occurred 28 years ago. On the other hand, there is no evidence that his venture today would succeed.
So on the balance of probabilities, I would say that I would not invest, without fresh evidence of success, in any public funds started by Larry Williams.
This is not to say that his personal account would not be profitable.
Some traders find the pressure of fund management so great that they are unable to duplicate the personal trading results. All we can say is, in the area of personal trading, we have no evidence one way or the other.
So far as the systems are concerned, the testimonials by some of the trading great in our industry are enough to sway me to say that his systems probably do have an edge. In this regard, I want to make special mention of Tom Demark.
Tom is a highly respected creator of systems. (See http://www.bloomberg.com/news/articles/2012-11-13/demark-fibonacci-charts-embraced-by-cohen-lure-investors). For those of you that are unfamiliar with the names in the article, just know that they represent some of the world’s best hedge fund managers.
It’s worth noting that Tom does little trading, but yet his systems are in heavy demand.
- If I were a systems trader, I would be interested in systems produced by Larry Williams.
- If I were an investor, I would not be interested in subscribing to his fund, unless there is evidence that he has overcome the problems he faced in 1988-1989.