1.Can you tell us about Creative Breakthrough, Inc. and what inspired you to start the company? Some background is required here. I was trained in this industry beginning in 1974 on the stock side. I was trained by some of the best in the business while I was at Merrill Lynch Pierce Fenner and Smith: Bob Nurock, Bob Precter. Robert George Constantine and likely the greatest communicator of the language of the market Chief market analyst Robert Farrell. I learned market history and how to trade as opposed to brainless buy and hold. In other words, I was taught the science of market timing. In the late 1980's I was Chief market analyst of R.Rowland and Company - a large Midwest full service brokerage firm. After a merger that failed Stifel Nicolus, a firm that did not believe in technical analysis or market timing, bought us. So as necessity is the mother of invention, I started my own firm in 1989, hence the Creative Breakthrough.

2.To what do you attribute Creative Breakthrough, Inc. success? I think there are several key factors. We keep it simple, educate, service and let word of mouth do the rest. That is not to say we don't advertise you have to. But on the other hand our marketing does not out produce our real time performance. Furthermore, we don't conventioneer it to the nth degree. We have a product independent of the marketing. Some of our competitors have no product without marketing.

We also believe in old rule of "know your client." During the boom of the 1990's everyone wanted to get rich and quick. The perception was all you needed was a data feed, TradeStation™ with a trading system and you were on your way. I have been with Bill Cruz and TradeStation™ since near the beginning and without question it is the state of the art trading platform and now with the online version TS-6, you can't beat it, full stop. However, there are just some people that cannot, to save their own lives, run a computer not even to say a trading platform. CBI does not cater to the masses because they are not suitable from a compliance point of view and they are not suitable from a technical support point of view.

3.Do you have any general suggestions for those who trade your system or another system? If you’re a trader, trade. Don't get all hung up in the "who's", the "what's" and the "how comes". Just execute the system orders. All your research should have been done when the system was purchased. The general concepts behind the system should be known. More importantly, the long term performance numbers should be have been studied so the trader had an idea of risk reward, efficiency of entries, exits, number of trades over fixed periods seasonal tendencies and so on. He should have a good feel for the system without know the algorithms and the confidence to pull the trigger.

On the other hand, if you want to be the system developer, buy fully disclosed systems and learn what the good ones have done. There is not one system developer on the face of the earth that has had an original idea. The successful system developers have learned from other successful system developers. Sometimes it may take years to find simple systems that work. It may take a capital investment on the system developer's part. But once he finds the systems that work keep any variations simple.

4. What lead you to develop your particular methodologies or approach to markets? Again it’s the simple concepts. Channel breakouts, trend following, opening gap patterns, support and resistance levels and market condition.

6. Could you describe why TradeStationZone visitors might want to consider using your products and services versus those offered by your competitors? I would ask them to consider the facts. For the S&P our day trading systems have over 6 years of historical performance. Combine that with consistency: The consistency in what we have represented to our clients over the years, the consistency of our methods in the development of trading systems and the consistency of our philosophy. Part of that philosophy is playing defense first. Instead of looking for pie in the sky, we offer a package of robust trading systems for a price our well-advertised competitors sell one system for. Another part of that philosophy knows it takes money to make money. Too many investors are looking to make a fortune on a shoestring. It just does not work that way. Oh sure some of us could be lucking and parley a bull run in sugar into a small fortune. But in general it just does not work that way. By example, hedge funds attract the very rich by offering very low historical equity drawdown, like 3 or 4 percent while achieving an annual rate of return of say 9 or 10 percent. This type of return is achieved by board diversification over many different market systems.

7. What do you feel is your company’s strongest asset in providing your customers with the best trading results possible? The basis of all of my systems are based on one basic principle learned 28 years as a priced based market analyst, keep it simple as there is nothing new under the sun. Just like in literature where all major life themes where played out on Shakespearian in the 16th century, there are no new trading system concepts beyond a handful or so. From there, you only have variations. That is really the key. What works is the basic building blocks like taking 90 percent of yesterday's range and add it to the open next for long entry and subtracting from the open next for short entry just add an exit on the next profitable open with a protective stop based on percent risk per trade.

We strictly control who owns and trades our systems. Before anyone else we trade marked the concept of broker assisted trading: TraderAssist®. From the system developer side of the market we pioneered the concept. We learned early on that without controls in place everybroker in the US had a copy of our system and individuals that bought our systems fully disclosed were selling our systems in the underground market. We were getting emails from old clients selling us a pacake of trading systems including our own. We found our flag shiip trading systems %C-DT in the hands of floor brokers and being discounted into. Since that time we have put in place strict controls over who has the systems and reserve the TraderAssist® brokerage exclusively one firm and one firm only.

8. Have you been trading this year? If so, how has that gone? Like most system traders the end of 2001 and January of 2002 witnessed drawdown. However, since the lows posted in January all of our day trading systems has been doing well. Profit factors have been steady for the year at 2.00 to 1.00.

9. Are you working on any new projects in which our readers would be interested?
We follow the markets. In other words, our focus for new products is what we see the public and the institutions asking for. It should be clear too most that the buy and hold bull market has changed into a traders or market timers market. So the demand for how to buy stocks or mutual funds is waning. We are getting calls from your major retail stockbrokers like A.G. Edwards for E-mini position trading systems. I think that is just the beginning of the change away from the more traditional investing to a trading environment.

We are expanding our list of product in the very near future. The areas of focus are more a function of client direction. We aggressively encourage our clients to be involved with CBI. We encourage just not constructive feedback but also developmental input. We listen to them in terms of the markets they want to trade and how they want to trade them. Moreover, we have clients that are doing research along with us. We have participating clients in terms of testing trading strategies. In fact we have clients that are so passionate about trading they work with us on system programming. As our markets expand we have a number of beta testers world wide helping us just not provide new trading systems they also provide us with better understanding of our end user. With that said the particular products that are coming to market would not be announced in advance.

10. Do you have any tips you would like to give to our readers? You bet. If you are a trader looking for a MTS, just monitor the providers over a period of time; look for inconsistencies in what they say. Avoid system provider4s that are always "reinventing themselves." In other words coming up with the new and improved mousetrap. There is no such thing. If you want to develop systems to trade yourself, buy the fully disclosed code from a respected system developer. Invest the money in a variety of entry and exit signals. Learn from the experts; see how it makes sense to you. From there change it to make it fit your style or the way you understand the market better.

Jack F. Cahn, CMT
TraderAssist®
Since 1989, Creative Breakthrough, Inc. CTA
http://www.traderassist.com/