Reasons from David Hightower, a principal of Hartfield Management Inc.

1. They have inadequate capitalization.
2. They are using someone else’s system.
3. They lack knowledge of the system’s performance.
4. They are unable to sit through flat periods or drawdowns.
5. They are unable to handle stress.
6. They lack commitment.
7. They experience drawdowns that are greater than their hypothetical testing.
8. They override the system’s signals.
9. Their ego prevails.
10. Their system is overoptimized; they make additional rules to take out losing trades.
11. They lack parameters for spike performance in markets.
12. They lack diversification between systems and/or markets.