[Nick1984]

That video posted up a while ago on the forums about the crash of Long Term Capital was great. Putting 100% faith in a rigid system is a recipe for disaster. There are countless philosophies across a wide range of disciplines which derride rigidity as the downfall of any person or system. Look at Bruce Lee's philosophies on martial arts!

Like torero said, in a bull market you don't need much skill to make money, discretionary or automatic. For a while now these automatic systems have enjoyed the run up and the programmers have been taking the praise. However with the recent volatility, and the market falling like a knife (just try picking the bottom on this one!) these systems aren't coping. They are too rigid.

All automatic systems are based upon the thoughs of humans. Their advantage is that when it comes time to act the system will act without hesitation. However what a distretionary trader has an advantage over is in adaptation. A discretionary trader would have made a killing over the last 24-25 days where as these large funds are posting losses.