© Ed Seykota, 2003 - 2004 ... Write for permission to reprint.

Ed Seykota's

Frequently Asked Questions

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TTP - The Trading Tribe Process  ...  Glossary

  TTP Workshop  ...  Resources  ...  The Book

Trading System Project

 

February 19-29, 2004

 

 

Questions

(Quotes from Ed in Red)

Answers

Sun, 29 Feb 2004


Family Tribe


Ed,

I would like to let you know that our "Family Tribe" has already done its 10th weekly meeting. Now we are three and it's starting to expand, pollinating through receptiveness and support, clarifying and catalyzing our intentions.

I am also running a site [in Portuguese]  http://ttp.tripod.com.br  to support other people to set up their own "tribe" and clarify their intentions.

Thanks for your support.

Yes. Family is the Essential Tribe.

 

Affection is responsible for nine-tenths of whatever solid and durable happiness there is in our lives. ~ C. S. Lewis

 

Education is learning what you didn't even know you didn't know. ~ Daniel J. Boorstin

 

 

Family

 

The Essential Tribe

 

Clip: http://faculty.haas.berkeley.edu/

arose/family.jpg

Sun, 29 Feb 2004


About Copyrights


RE: your 2/21/04 post concerning your understanding of proper use of
copyrighted material:

My understanding as a professional photographer involved on a daily basis
with issues of copyright, is that there is no difference whether use of a copyrighted image is by a non-commercial, educational or public service entity, or by a commercial entity. Images are copyrighted by their creators at the moment of creation, any use by other parties whatsoever constitutes a copyright violation. There is no clause under the copyright act that permits certain other entities to claim free usage.

It's notable that you credit the assumed copyright holders.

I once was contacted by a mid-western university seeking permission to use
one of my images to illustrate one of their courses on their website. They were requesting permission, but they had already copied the image and were running it online ahead of contacting me. Entities seeking permission should obtain said permission prior to any use of an image. As the use of the image may have been objected to by the image's subjects, I had to decline permission and additionally had the task of demanding the image's immediate removal from their site. By running ahead of being granted permission, the university put itself and me in a position where we both could have been
sued by the subjects.

OK.

 

One approach to writing is to go with the flow, and be considerate of others.

 

An approach to winning the Boston Marathon (according to one of the winners) Is to avoid fried foods and never look back.

 

FAQ does not recommend what you should do.

 

For more opinions and analysis on copyrights, see:

 

http://www.templetons.com/

brad/copymyths.html

 

http://www.fplc.edu/tfield/copynet.htm

 

http://www.ariadne.ac.uk/

issue5/copyright/

 

http://www.fno.org/jun96/legal.html

 

http://www.nolo.com/index.cfm

Sun, 29 Feb 2004


DIY TTP pt2

Hi Ed,

Thanks for the answer on DIT TTP, Wed 11 2004.

I still have one particular problem - what do you mean by " ...to just experience the feeling"?


How do you experience a feeling? Do you mean - understand the feeling? If I know about the feeling, then I am experiencing it somehow, right?

Best regards

I don't have any entries for Wed 11, 2004. (No Month). 

 

Experiencing feelings, Sending and Receiving, in the TTP sense, is something people seem to learn best in person.  You might consider joining a tribe or attending a Workshop.

 

Talking about feelings is not the same as experiencing them.

 

Sex manual is not the same as sex.

 

 

Reading about Football

 

is not the same

as being on the field.

 

Clip: http://sportsillustrated.cnn.com/

features/2001/swimsuit/covers/01_lg.html

Sat, 28 Feb 2004

Set it and ... Forget it!

Some FAQ readers might be familiar with the Ronco infomercials, such as the one for the Showtime Rotisserie.

This fellow Ron seems to know how to follow the system and stay with the trends.

Showtime Trading System: “Set it and … Forget it!”

Note: Traders may also want to remember to manage risk and keep an eye on their daily P&Ls to make sure the system is following the intentions of its developer.

 


 

Source: http://shop.ronco.com

If you are trying to avoid the feelings of following a system, you can forget to remember them, or remember to forget them.  Forgetting to forget them and remembering to remember them don't work so well.

 

You can also experience the feelings of following your system and convert them from nemeses to allies.

 

 

Ebbinghaus Forgetting Curve

 

Syllabus retention after an hour is about 50%, after 31 days, about 25%.

 

Clip: http://www.unc.edu/

~eckerman/forget.jpg

Sat, 28 Feb 2004

 

Couple of TT Questions

Chief Ed,

I notice 'polarity process' as a possible item for the May event. I'm looking for the definition of 'polarity process' on TT. Where is it located?




The Polarity process is something I use in the Incline Tribe from time to time and plan to bring to the Workshop. 

 

It has to do with endowing your body with alternatives, and using TTP to processing through to a decision, kinesthetically.

 

Processes seem to propagate best person-to-person ... at a workshop, or by some of the Pollinator Bees that buzz from tribe to tribe.

 

"One day Alice came to a fork in the road and saw a Cheshire cat in a tree. 'Which road do I take?' she asked. His response was a question: 'Where do you want to go?' 'I don't know,' Alice answered. 'Then,' said the cat, 'it doesn't matter.'" -- Lewis Carroll

 

 

Pair of Forks in the Road

 

Clip: http://physics.kenyon.edu/

EarlyApparatus/Acoustics/

Tuning_Fork/Tuning_Fork.html

Sat, 28 Feb 2004


Fired Up for Workshop

(attending for the second time)


Hi Ed,


I'm really fired up for May 7,8,9! If there is anything I can do to help out (like pick up drums, pick someone up at the airport or help set up), please let me know, I'm happy doing it.

Respectfully,

People seem to catch on to TTP  face-to-face, by practicing it with someone who knows how to do it.

 

One big contribution you can make is just to attend and practice with others.

 

 

Sat, 28 Feb 2004

 

Writing Computer Code

[To get] more code work offloaded, you might consider [an outsourcing company].

Designing and defining the system is 99% of the job. The other 3% is being really good at math.

Sat, 28 Feb 2004

 

Confirmation

Hi Ed,

I would like to confirm the continued presence of my name & contact info in the Intentional Community Directory. So far, I have been contacted about TTP by around 3 people in India, but none of them from Chennai. However, we are trying to work out a meeting, hopefully not too far into the future.


Best,

You might consider mentioning what you want to do to some people in your local area.

Fri, 27 Feb 2004

 

TTP Workshop

Hi Ed,

I wish to attend the upcoming TTP Workshop. I have sent the page you requested to be signed along with a check for payment. I am looking forward to attending the workshop.

Sincerely,

Yes.

Fri, 27 Feb 2004

 

News From Short-Term Traders

Hi Ed !

Interesting little snippet from online conversation between commodity traders today, FYI.

A: Several locals who traded at MATIF moved to the futures exchange in Montreal as they were also incapable of trading off-floor.

B: Reminds me of a candid conversation I had with a local in the silver pit some years ago. I asked him how he traded, and he answered, "I look at the pivots, daily highs and lows, support and resistance, oscillators, calendar spreads & I steal from my customers." I asked how he was doing. "Well, I'm losing in every strategy except the last one."

The Crocodile allows the Plover to enter it's mouth and take bits of food.  The Plover gets a free meal and the Crocodile gets clean teeth and gums.

 

The Trend Trader allows scalpers to take a few points here and there, against the day when he just wants to keep buying and buying and buying ... and the scalpers get to experience drinking out of a fire hose at close range.

 

 

The Plover

 

Lives on pieces of food and leeches

he finds in the mouths of crocodiles.

 

Good legs are helpful

in this line of work.

 

Clip: http://birdingonthe.net/

imgs/masi/THMB/Plover.jpg

Fri, 27 Feb 2004

Exhilaration


Ed Says:

Experiencing Feelings on the Fly can be exhilarating.

You might take your feelings of wanting to avoid your feelings, into TTP as a starting point.


Ed,

I find there is nothing exhilarating about crossing the threshold of frustration, loss and boredom to exhilaration.

Your comments are consistent with trying to do TTP logically.

Fri, 27 Feb 2004

 

Fred and I



Hello Ed,

I am diligently working with TTP for about nine months, for a total of about 20 hot seat experiences. Out of the 20 I would say 4-5 are accompanied by major AHA's and tremendous outpouring of emotions.

 

The first big one is when [Name 1] from the Toronto tribe participated in our group and the second when [Name 2] from your Incline Village group attended our meeting. The other 2-3 very intense hot seat experience are with [Name 3] the leader for the second Manhattan group ... Interesting how Fred finds allies to help.

In fall of 2003 my focus and the target for Hardball is to 'Consistently follow my system'. I am pleased to say as a result of Hardball after 15 long years of not following my systems, now I am able to consistently follow my system and I have No Urge to do non system trades.

I believe whatever feelings are in the way of me consistently following my systems are now dissolved. This is a major major achievement and accomplishment for me !

 

A true testament that your method work !

I still have much work to do in the area of trading, of position sizing etc, still make blunders from time to time, however I am very committed to working at them via TTP.

The readers of FAQ may be interested, it is not an easy straight line process for me to reach this point, I experience many set backs along the way, there are many times when I say to myself all this time on hot seat and working with a tribe but no results to show for, still same issues with trading. Please see my FAQ 'TTP Peels Away the Layers, #2' Thu, 11 Dec 2003, my sense of frustration is very apparent ! However I now believe all those hot seat experiences help, one by one, each resolving some issue along the way, still have a way to go ...

All the best and thanks again for all your assistance.

OK.

 

 

When you Get to the Center

Of the Onion

 

you get another onion.

 

Clip: http://www.rosemaryr.com/

HTML/Gall9b6.htm

 

Fri, 27 Feb 2004

 

Workshop Question

 


Hello Ed,

I have a question about your comments below, could you please clarify how they relate to a 100% mechanical systems trader?

 

I thought all the "ritualistic trading activities" are incorporated into a system and then it leaves no room for 'subtle and unconscious activities" that dominate trading. Are you referring to discretionary traders?

Thanks.

Ed Says:


In addition, the theme of this workshop is "Defining Your System." Traders may find that the majority of their "trading activities" are basically ritualistic in nature and actually contribute little to the process of trading successfully.

Meanwhile, a few activities, many of them subtle and unconscious, dominate the trading. One of the intentions of this Workshop is to define each trader's actual trading system, and to elevate the parts that contribute to success to consciousness and consistency.

Your "room for subtle" does not incorporate into in your conscious system or computer program; it appears in your emotional response patterns.

 

My experience is that about 20% of the activities you perform as a trader contribute about 80% of your profit - and that the other 80% of the things you do,  have, at best, no effect.

 

 

Vilfredo Pareto, 1848-1923

 

Famous for 80:20

 

The Pareto Principle: the 80/20 rule: about 20 of the effort produces about 80 of the result; 20 of the people produce 80 of the work; etc.

 

Pareto's Law of income distribution

 

    log N = log A + m log x 

 

Pareto's Pet Concept: Ophelimity

 

Clip: http://cepa.newschool.edu/

het/profiles/pareto.htm

Fri, 27 Feb 2004

 

Talent


I think someone may have asked before but I cannot seem to find the exact question on the FAQ. May I please ask you again to elaborate on what it means that "Talent has them (top traders)"? Do you mean talent has top traders finding their right livelihood (trading), and thus the resulting fact is that they are top traders? Thanks.

The sculptor begins the statue by imposing his image on the stone -- and ends by taking away what the statue tells him doesn't belong on it.

 

At first, he has the talent, later it has him.

 

You can try to impose your will on the markets, or let them tell you what to do.

 

To look up something on this site, use "Search this Site", above.

 

 

Sculpture Patiently Waits

inside the stone

until a sculptor sets it free;

 

Clip: http://www.users.bigpond.com/

wernerschmidlin/images/l.shiva.head.jpg

Fri, 27 Feb 2004


Sydney Contact


Hi Ed,

I have emailed the Sydney Australia contact, but as yet no reply. Could the address be incorrect? or is there another tribe I could get involved in?

best regards

On the Tribe Directory Page, a grey-out entry indicates no response to the "Are you still operating" survey.

 

 

According to 50% of people surveyed,

 

if you want to know something,

take a survey.

 

Survey says Brits are Foreplay Flops



Brits are a flop when it comes to foreplay, according to the biggest ever survey of its kind.

The research found 80% of British men didn't even know what foreplay was, mistaking it for a sport, a computer game or an item of clothing.

Jordan, chosen to front the event, said: "These results are so shocking that even I was surprised.

"Sex without foreplay is like toast without butter and yet some people in this country think that it's okay to get away without doing it, but not in my book.

 

Men rated themselves very highly at foreplay, with 70% giving themselves 9/10 for their technique. But the ladies begged to differ. They gave men just 6/10, and rated themselves even lower, at 5/10.

 

Clip: http://www.ananova.com/

news/story/sm_804333.html

Thu, 26 Feb 2004

 

Hi Chief !

 

Prince George Tribe

I would like to start a tribe.

 

 

Welcome

Prince George !

 

You are on the Directory Page

 

 

British Columbia

is in the red

 

and so are most all countries.

 

Clip: http://www.livejournal.com/

userinfo.bml?user=britishcolumbia

Wed, 25 Feb 2004


Reading


Ed,

You might enjoy reading this: http://www.processwork.org/

I noticed some similarities between TTP and Process Oriented Psychology.

Best Regards

Yes.

 

Dr. Arnold Mindell's Process Work holds that the solution to a problem locates within the disturbance itself. 

 

Dr. Stanislav Grof holds that the symptom is the cure in action.

 

TTP holds that experiencing feelings

is a basic intention of life itself.

 

Meanwhile, some people subscribe to laws that try to protect people from hearing things that might give them a "bad" feeling.

Wed, 25 Feb 2004


FYI

Ed,

I have not felt compelled to update you on the progress of the [Location] group for sometime. We continue with the work. From my subjective point of view we engage deeper levels of feeling and experience.

I do feel compelled to write about a personal and I believe related experience. First some background -- My wife's business fluctuates with the city's economy and she finds it in a significant contraction. This has caused a great deal of concern, she has laid off staff, far fewer jobs come in the door and those that do have a smaller scale.

 

She and her partner bicker more often. Over the past weeks she has spoken frequently of feeling overwhelmed and frightened, but more often expresses this in anger and frustration at me, our children, or anything else in her path. I recognize much of the same feeling, avoidance of feeling, and consequent dramatic reaction in myself as I experience some of the inevitable reversals of promise and fortune associated with my current efforts to raise capital for a new hedge fund. At our worst our dramas seem to amplify each other's and we spiral into escalating anger and destructive interaction.

Over the past months, like many others, I have noted a kind of migration of TTP awareness and practice into broader areas of my life and interactions with others. But, last night something had caught me which seemed to displace all I had learned.

 

I came home late from a meeting with interested investors, a good step in the right direction. The family had eaten, the children had finished their homework, we spent the evening in an easy family way. The kids went off to bed, my wife and I curled up together unwinding in front of the TV.

 

Just before we went to bed, she said something about work, I don't even remember the comment, yet it echoed in me setting off a twinge of anxiety and fear. By the time I shut off the lights I found my wife asleep in bed. I crawled into bed, but could not fall asleep, anxiety and a kind of despondency seemed to build through hours of restlessness.

 

Over the past months, I have increasingly found myself, when under stress or caught up in a negative spiral, able to enter a TTP like state on my own, letting myself embrace the full scope of even upsetting and difficult feelings and experiencing an internal shift (Ahhhh!), which often triggers yet another feeling continuing the process. This more often than not leads to an experiential if not cognitively different perspective on the underlying matter. Rather than a "do it yourself" process it feels more like a natural extension of TTP and hardball into more areas of my life.

I deliberately tried this, but for the first time nothing I tried could bring me to a place wherein I could let myself have the feelings, instead the anxiety and despair continued to overwhelm me, my mind continued to
race.

 

It seemed as if every fear my wife has carried over the past months, had found a comparable frequency resonating within my own psyche. Sometime after 3 AM I passed into an unresolved numb like sleep, yet somehow grew increasingly aware that my wife grew increasingly fit full. By 5 AM she woke me. In a kind of agony of despair, sobbing, and defeat she began to talk: about her fear, about feeling overwhelmed, and about wanting it all to stop.

 

I listened as carefully as I could given my lack of sleep and the early hour, yet felt her somehow distanced from a direct experience of the feelings -- she kept talking "about" the feelings rather than experiencing them. At one point she said, "...can't we just make love and stop all of this for a while..." The moment did not support that desperate desire.

 

Instead, without a word, I took her into my arms, not to comfort her, but to "receive" her. I have neither words nor context to properly relate the measure of the experience, which followed.

 

I felt wave upon wave of what I can only describe as  feeling / sensation / emotion cascade through my body setting off intense trembling and physical spasms, which sprung unbidden from different places inside of me.

 

Each wave passing / resolving as the physical sensations transformed me or perhaps more precisely transformed through me. I noted, what I have in past Ahhhh experiences recognized as endorphin released tears streaming down my face and great yawns accompanying / simultaneous - with the release of tension.

 

I don't know how long we spent like that, it felt out of time. My wife said nothing about my trembling and spasms, even though I had experienced them physically moving her! After a time the "receiving" subsided. I asked my wife how she felt. She replied in a exhausted, but deeply calm voice, "tired," and fell into a deep sleep still wrapped in my arms.

 

I slept too, my mind at ease and untroubled. We woke by 7 AM to prepare for our day and get the children to school. Yet we moved through our morning rituals differently, tenderer with each other and with the children. She called me early this afternoon to relate something she had heard from one of the children's teachers, but I felt something deeper motivating the call. We lingered on the phone, caressed by the silence. I do not know what to call what has transpired between us, perhaps I don't need to know. It seems we have entered a different realm of communication than we knew prior to this last sleep.

Many thanks and best regards,

The promise of NLP and Western therapy in general, is to alleviate suffering, to somehow get rid of  "bad" feelings.

 

For example, the NLP methods of Swish, Bypass and Shunt all aim to  move you past "bad"  feelings and on to "good" ones.

 

As you point out, when you attempt to use TTP to effect deliverance, it does not "work."

 

Left to our own devices, we tend to go for the fix, rather than just being there with the condition.  In service to each other, we tend to return to our willingness to just be.

 

As long as you have an agenda to get better or to get rid of feelings, you tend to hold back from fully experiencing your feelings in the now.

 

When you fully experience your anxiety and despair, unconditionally, and fully, it does not go away.  It rather turns kind of inside out and re-vivifies as part of your emotional control panel, one of your allies. This may accompany emotional release and insight (Aha!)

 

Your narration of your subsequent receiving of your wife is consistent with tapping into the joy.

 

Resistance to feeling the joy may manifest as paroxysmal spasms and waves of shuddering.

 

You might consider fully allowing your anxiety and your joy to manifest and receive each other. 

 

Intense communion tends to radiate and heal those around you.  I feel you and your wife are fortunate to have each other along the path, and your friends are fortunate to have you as inspiration and reference.

 

 

 

Sending and Receiving

 

become one.

 

 

Clip:  http://www.warhols.com/

lovers%20.jpg.jpg

 

Wed, 25 Feb 2004

 

Some Trading Rules

I think this is a good paper [about a trading system] ... that some may find beneficial.

FAQ does not endorse traders or commercial products.  See Ground Rules.

Wed, 25 Feb 2004

 

Seeking More Clarification on Trends


Hi Ed,

I'm still not sure I get it. From previous posts I understand that:

1. You only trade trending markets.
2. All markets have trending periods, but also sideways periods.

Therefore, you are saying that you are only trading markets when they are trending.

Putting a stop outside the support and resistance band described on Feb 4 does not guarantee you are only trading when the market is trending.

Surely it is a fact that trend following involves getting whipsawed most of the time.

This means that most trades (the losers) take place during sideways periods, because
a trend trader will repeatedly buy failed breakouts through resistance until eventually getting on one that succeeds and turns into a trend. The minority of trades are therefore taken during the trending periods.

Can you clarify this apparent contradiction?

I do not see a contradiction.

 

The trend is your friend except at the ends where it bends.

 

 

 

Astute Cyclists

 

don't try to tell the path

where it "should" go.

 

Clip: http://www.suite101.com/files/

topics/238/files/Di-at-bend.jpg

Mon, 23 Feb 2004

 

Blast from the Past

Is this the famous Ed Seykota, known around these parts for his famous clear vinyl album "Seykota" featuring the snappy tune "Tuna Fish"?

I was your photographer from those days ... and I wanted you to know that I'm still around, now working as a senior IT analyst for the City of Encinitas, your old stomping grounds.

It's been over 20 years, but I was amazed by you then, and I'm still amazed.

OK.  Here's one for you ... and be sure to write again in 2024.

 

 

 

 

Clip: http://www.wilken.freeserve.co.uk/

Montypython/Songs/song36.htm

 

 

Mon, 23 Feb 2004

 

Site-Specific Search for TTFAQ

 

Ed,

Here is the resend of Seykota-Search. Here are some interesting facts:

1. See this Google site-specific search feature implemented at

 

 www.newtechusa.com

 

at the bottom of the home page. This is how it ultimately looks on any site. Google provides some options I zero out, such as 'search WWW'. My implementation searches my site only.

2. Google provides the generic setup, free at:

 

 http://www.google.com/searchcode.html

 

 Note the license agreement.

3. The attached files are all set up for  ... search. You can see the TT logo added. I set everything up. All you have to do is paste it in. More likely you'll look at the Google setup, look at what I did, and consider your own tweaks. Either way the attached is ready to roll as-is.

4. The project got me thinking. See the most recent (prototype) results at

 

 www.newtechusa.com/searchany.asp

 

You may consider book marking.

If the attached is (still) missing, let me know. Any questions call. My intention is to make it simple and quick to implement search on the TT pages.

Thanks for helping improve this site.

 

See the header for

"Search this Site"

Mon, 23 Feb 2004

 

Wants to Start a Tribe

Hi Chief !

I'd like to start an Intentional Community. Maybe there are people in my area that would like to attend ? Please post my email and name as a contact person. Thank you and have a great day now.

To start a tribe, see the procedure on the Tribe Directory page, including providing the name of a city in which you intend to conduct your meetings.

Mon, 23 Feb 2004


More on Magazine Covers


Hi Ed,

I found the post entitled "Classic Picture" and your response interesting. I am familiar with the concept of utilizing magazine covers to gain information about the degree to which a market move is discounted by the media.

 

However, I have not heard before specific information of the type you offer in your response to that post. You write, "Covers with emotionally evocative images tend to be pretty good contrary indicators." I find that statement more useful than the more general idea, as I have heard it expressed by others, of looking at magazine covers as a sentiment gauge. I wonder if there is any other information that you could offer that would provide insight about utilizing mass media publications to alert a trader to possible opportunity?

Specific things that I wonder about are whether you find certain types of publications generally more useful than others for this purpose, say "Fortune" or "Barron's" over "Money" or "Time" or "Newsweek"? Perhaps the latter are more useful than the former or vice versa, or perhaps there is no difference. I wonder if the further removed the general subject matter covered by a magazine is from the world of finance, the more telling an emotionally evocative image relating to the markets on the cover might be?

More commentary from you on the criteria you find useful regarding using magazine covers and other media images as contrary indicators would be informative. I trade primarily using mechanical systems (although as you point out in several instances in FAQ, every system has quite a bit of a discretionary element to it), and I realize that magazine covers are a difficult market barometer to program into a computer algorithm. However, I like to explore investor psychology (especially my own!) as a means to gain insight into things that I might program into a PC, or just program into my own personal organic computational engine.

Thanks,

Tribe Members tend to be able to distinguish between story telling and emotional abreaction - also between informational magazine covers, and ones that reflect societal emotional abreactions - that typically accompany a release of tension, an AHA, and the end of a trend.

 

 

Mon, 23 Feb 2004


www.Turtletrader.com

Hi Ed,

You have references on your site to www.TurtleTrader.com  and visa versa ...  I found your site from [that] site and I enjoy their "free" information and audio recordings.

 

I resent the fact [that they charge] for their course ... [and that the author] is not [a trader].

 

Can one learn the lessons that need to be taught in trading by someone that is not a trader ... ?

I recommend www.turtletrader.com for the wealth of free information on that site.

 

FAQ does not endorse commercial products.

 

FYI: Edwin LeFevre, is the author of one the best books about trading, of all time, Reminiscences of a Stock Operator, a story about Jesse Livermore.  LeFevre doesn't trade so much as write, mostly for the Saturday Evening Post.

 

You might like to take your feelings of resentment to a Tribe Meeting as an entry point.

 

When you find the positive intention of your resentment, you might be able to use it to guide your selection and maintenance of a support team.

 

 

 

Traders Trade

 

and Writers Write

 

Mon, 23 Feb 2004

 

Test Driven Development

Hi Ed,

A number of questions and answers on FAQ have mentioned software bugs.


One method to reduce the number of bugs in a program is to do test driven development.

Test driven development breaks the programming process into 3 steps:

1. Create a test
2. Write code that will pass the test
3. Refactor

The actual testing is done by a test engine program. Every time you compile
the code, you run the test engine. The engine runs every test that you have
written. That way, when you change something, you test not only that your
change had the effect you wanted, you also will find out if it broke some other part of your system that you weren't thinking about.

For example, if I decide that I wanted to have a function that calculated a
20 day exponential moving average, I would first write the test.

...
double TestValue =

Calculations.TwentyDayExponential(15,14);
AssertEquals(TestValue,14.9);
...

The next step would be to write the Calculations.TwentyDayExponential
function. You are done writing the function as soon as it passes the test.

Once you have a working TwentyDayExponential function, you may try and find a new way to calculate the average. You are free to monkey with the
function as much as you want, because you know that if you do something wrong, you will find it when your test fails.

Another way you may want to refactor is if you decide to also calculate a 50-day exponential moving average. One series of steps to do that is:

Make the test call a function called NDayExponential
Change the name of the Calculation function to NDayExponential


Recompile, and retest

Modify the test to pass in another parameter, 20, the number of days the
average is to calculate.


Modify the NDayExponential function to take the additional parameter.


Recompile, retest

Write a new test to calculate an NDayExponetial, this time passing 50 as the
number of days.


Modify the NDayExponential function until it passes both tests at the same
time.

There are a few books on the subject of test driven development. There are
also a number of free resources.

http://www.xprogramming.com/

software.htm  has links to test engines for
dozens of different programming languages.

JUnit is the Java test engine. It is really the flagship of test engines, and the junit site has a lot of information about test driven development which will be useful whichever platform you use. http://junit.org/index.htm

For people who use C# or one of the other .NET languages, you will want NUnit. http://nunit.org/

If anyone writes to you with questions about TDD, and you don't want to take
up space in the FAQ, you are welcome to forward the questions to my e-mail.

Thanks,

OK.

 

Sometimes, complicated methods to eliminate bugs, wind up introducing even more of them.

 

Hairy proofs and derivations can indicate excessive math-turbation.

 

You might notice the extent to which you bury yourself in math, as a way to avoid feelings, or as a way to avoid pulling the trigger on a trade.

 

 

 

Elevating Math

from the Ridiculous to the Sublime

 

Equation for how easy it is

to eat food with chopsticks.

 

http://www.abc.net.au/science/

news/stories/s1041709.htm

 

Mon, 23 Feb 2004


Workshop

Dear Ed,

Please reserve me a place for the May workshop. I prefer a non - smoking room. Check and page in the post.

Many Thanks

OK.

Mon, 23 Feb 2004


Power Struggle



Ed Says: You might notice what is standing between you and experiencing (1) your feelings of frustration and (2) your feelings of not liking it.


Precisely, and if this can be reduced to a concept: not liking or not accepting being unable to control (comprehend) people (the market).




Reduce things to concepts may be a way you avoid your feelings.

 

You might take your feelings of wanting to avoid your feelings, into TTP as a starting point.

 

 

Struggle

 

can be Fred's way

to get you to experience your feelings.

 

Clip: http://www.wburghardt.com/

images/struggle.jpg

Sun, 22 Feb 2004

 

Celebrate Feelings & People

Dear Mr. Seykota,

As I'm working towards celebrating all my feelings ("Good" or "Bad"), I begin to wonder and feel that I want to work towards celebrating all the people (again, "Good" or "Bad") I meet in life as well.

 

They may not do things that I agree and I may not even like them, but I strive to learn to embrace them as a person. I think there is a reason why they are there and doing whatever they are doing, but I don't need to know that reason. Just knowing that, my happiness does not need to depend on them or whatever they do to me, and if I allow myself, I can celebrate my life with them, just like I am celebrating with my feelings.

BTW, speaking of celebrating feelings, I feel that nowadays I see feelings with a lot more curiosity instead of resentment, even if it is some soreness, discomfort or even sudden shock. I like the progress and I thank you for introducing me this concept of celebration.

ciao,

OK.

 

 

 

Celebrate !

 

Clip: http://www.krismoffatt.com/

celebration%20copy.gif

 

Sat, 21 Feb 2004

 

Experiencing Feelings on the Fly


After 1 year of being a TTP practitioner with my tribe, I think I understand the process very well to the point where I wonder if I might be okay to experience feelings “on the fly” when it comes up instead of waiting for the next tribe meeting.

Is it better to delay fully experiencing these feelings and wait to experience them during the meetings where there are willing participants who are aware of the process or just experience them with whoever is around?

I feel as a receiver, I am well equipped to practice the receiving with whomever….but as a sender, I don’t feel the same way. I feel I need someone who understands.

Example:

The same feelings come up before I approach potential investors to tell them about the fund I am running as I suddenly think “they might not understand anyway, so why bother?”

Heartbeat pumping, swallowing my throat, tonsils dry up etc…then I end up sounding uncertain, anxious, jumpy, nervous, arrogant etc. (the exact opposite of what I am in normal everyday conditions)

So in the end…I get what I want -à they end up not understanding my campaign and equally important, not investing.

Another issue I have is that my track record is not good enough for them so I end up not approaching potential investors until it is good enough. But it is good enough for me as my goal is to have the best risk/reward characteristics as a primary goal and the best absolute returns being a secondary goal.

Recently, I have not contributed to the tribe as no new feelings have arisen (at least nothing that has not already been brought up in FAQ’s). I feel this and the two issues I mentioned above comes across to most of the TT readers and has not been addressed.

My intention for TTP is for it to disappear, as a passing AHA, into the fabric of life. See FAQ Home Page.

 

TTP seems to work best in a Tribe setting, where others can help you focus on fully experiencing your feelings.

 

Between meetings, Tribe Members tend to attract others who are good senders and receivers, so TTP becomes just part of life itself.

 

Fully experiencing feelings "on the fly" by yourself requires intention, discipline, courage, practice - since you are trying to explore areas you instinctively avoid - and you may drift into trying to fix or get rid of your feelings, rather than go with them.

 

 

 

Experiencing Feelings on the Fly

 

can be exhilarating.

 

 

Clip: http://www.libertybikes.com/images/

I%20can%20fly.jpg

 

 

 

 

 

Sat, 21 Feb 2004

 

Good 'ol Abe Had his Head

in the Right Place


You cannot bring about prosperity by discouraging thrift. You cannot strengthen the weak by weakening the strong. You cannot help the wage earner by pulling down the wage payer. You cannot further the brotherhood of man by encouraging class hatred. You cannot help the poor by destroying the rich. You cannot keep out of trouble by spending more than you earn.


You cannot build character and courage by taking away a man's initiative and independence. You cannot help men permanently by doing for them what they could and should do for themselves.


-- Abraham Lincoln

I wonder where you think the people now running our government have their heads.

 

You might take your feelings about missing Abe and his philosophy to a Tribe Meeting as an entry point.

 

 

 

Abe Lincoln

 

Not much risk of him

or those like him

winning an election today.

 

Clip: www.weirdload.com/ lincoln.html

Sat, 21 Feb 2004


TT Images -- Fair Use / Legal Question


Ed,

I am creating a new web page. I see images on Google search I am interested
in using. I see that TT pages use images from elsewhere on the web, and
provide a source link.

My question is: is the use of such images without explicit permission to do
so free of legal risk as far as you know?

I wish to do the same thing (to display some images that are located elsewhere on MY page) and I am wondering if you can provide summary pointers to any due-diligence research /l inks you may have.

Thanks,

FAQ does not dispense legal advice or tell you what you should do.

 

My layman's understanding is that non-commercial, educational and public service sites can use images from other sites if they cite the site. 

 

If you charge for your site, or re-sell the images, you may like to pay royalties to the copyright owners.

 

As a courtesy to the sites that furnish your clips, you might like to copy the images and include them on your site, rather than refer to their URL, as this does not tax their  bandwidth.

 

I recall one instance of a complaint about my use of images;  I post an animation of a girl jumping into a swimming pool to illustrate plunging into a market. The girl's father writes and complains about using the clip.  I promptly remove it.

 

 

 

To Avoid all Risk

 

you can use your own pictures,

and pictures of your own pictures,

and pictures of them.

 

Clip: http://www.eskimo.com/

~noir/ftitles/ladysh/lfs17.jpg

Sat, 21 Feb 2004


NLP and TTP


Hello Ed,

Do you find Neural Linguistic Programming helpful in facilitating the TTP Ah-Ha experience? I have included some of the NLP linguistic forms. These forms remind me of your SVO-p rule. I find them helpful in my own internal communication and when reading text that contains excessive distortions, deletions and generalizations.

 

They come from a couple of NLP books. One by Joseph O'Connor and John Seymour and others from the classic The Structure of Magic by Bandler and Grinder. It is part of NLP that I enjoy the most. I don't understand nor really believe the eye-motion-visual / kinetic/ auditory part of NLP but I find the following linguistic forms and their corresponding challenges helpful. I shared them with our local TT.

Here are the list of the linguistic forms the books mention:

Deletion
=========
Judgment
Example: "Money can't be made trading stocks"
Challenge: "Who Says?"

Unspecified Noun
Example: "My stock did well"
Challenge: "Who or what specifically?"

Unspecified Verb
Example: "He exploded."
Challenge: "How specifically is this happening?"

Nominalization
Example: "His education was superb."
Challenge: "How is this being done?"

Comparison
Example: "Trend Trading is best."
Challenge: "Compared to what?"

Kosher
Example: "He didn't realize."
Challenge "Are the parameter count of verb/nouns correct?"

Generalization
=============
Modal operators of Possibility
Example: "I can't trade like that."
Challenge: "What prevents you from ...?"

Universal Qualifiers
Example: "You always say the wrong thing at the wrong time."
Challenge: "Always?" "Never?" "Everyone?"

Modal operators of Necessity
Example: "I have to be in the market all the time."
Challenge: "What would happen if you did/didn't?"

Distortion
==========
Presupposition
Example: "Because my wife was an alcoholic, she didn't drive well."
Challenge: "What leads you to believe ...?"

Complex equivalence
Example: "He didn't compliment me on my dress. He doesn't like me."
Challenge: "How does this mean that?"

Mind Reading
Example: "You think me stupid."
Challenge: "How do you know ....?"

Cause and Effect
Example: "You made me feel bad."
Challenge: "How exactly does that make this happen?"

NLP is the Grinder and Bandler model of Milton Erickson's methods. 

 

The practice of NLP varies widely from practitioner to practitioner.

 

Some practitioners use NLP to avoid feelings by manipulating your neuro - logical around them.

 

Others use NLP to locate and experience feeling sub-modalities, such as temperature, texture, taste, etc.

 

TTP facilitates Fred fully sharing experience with CM.  This tends to convert "bad" feelings into "good" instruments on your emotional control panel - and tends to dissolve drama associating with trying to experience repressed feelings.

 

TTP seems compatible with NLP, and with other forms of personal and spiritual growth technology.

 

When you find the positive intention of your feelings of disgust and anger, you can use them to detect the flaws in the linguistic forms you cite.

 

 

 

A Positive Intention of Disgust

 

is to detect linguistic manipulation

 

 

Clip: www.aperfectworld.org/

emotions.htm

 

 

 

Fri, 20 Feb 2004


Good Question

Hi Everyone,

I answer your curiosity. The Ceiling and Floor of an integer are two types of mathematical rounding functions:

http://mathworld.wolfram.com/

CeilingFunction.html

The ceiling of 5.1 is 6. The floor of 5.1 is 5. Some people like floors, I like ceilings.

The insight I sight from the site you cite is that Rounding refers to various Nearest Integer methods, not to Ceiling and Floor functions.

 

Your clients may prefer you use standard math (rather than clever inflation functions) when you report your performance.

 

You might take "desire to inflate" into your tribe process.

 

 

People who like to inflate

 

find a place at NASA

building light weight Space Reflectors

 

 

Clip: www.abc.net.au/science/news/ stories/s195292.htm

Fri, 20 Feb 2004

 

[My Advisor]'s Recommendation

to Contact You



Dear Ed,

I hope you can give me some advice, because I am at a very conflicting point in my trading career. I have been meeting Dr. [Name] because he has been coming to consult with me and other individual traders at a trading shop I work at in Chicago. Anyway, to get to my point .....

I have been a market maker in the E-mini S+P for two years glued to my monitors all day long from bell to bell and have done quite well for myself, but I truly believe that that is not where the real money in trading lies.

 

I truly believe that trend trading is the way to go. I also believe that short term trading on an intra day basis is extremely stressful and ultimately it is just a losing proposition.

I am only 23, but already I'm thinking about the longevity of my trading career as a scalper, and to be honest I think it can last only about 5 years MAX.

 

So I discussed with Dr. [Name] whether I should continue to scalp and learn how to trade my own money that I've made through scalping with a trend trading style, or if I should actually quit my job as a scalper and try to work for a successful hedge fund even for free if I have to so I can have a mentor to learn how to trade trends.

 

I don't know how much I can learn though because I truly believe that you can only learn by actually trading. I was a self taught scalper, but I still believe it helps to have mentors.

I even approached my boss about this, and he basically trashed long term trend trading systems, saying that you cannot control risk trading long term, and was very much against it.

 

Then I asked him, "How do you account for the success stories like yourself or John Henry." He said that they were consistent because they learned how to control risk on a intraday time frame.

 

He said that most of the great trend traders blew up. He told me that Richard Dennis blew up and Jesse Livermore ended his trading career with a bullet through his head because of trend trading.

 

Do you agree with this?

 

I still agree with Jesse Livermore, that money is made by catching trends with strict money management rules and discipline. Not by jumping in and out of the market on a second to second basis. What do you think?

Sincerely,

Say you buy at A and sell at B. 

 

Then, to make money, B has to be higher than A, so there is a trend between A and B. 

 

No trend, no profit.  All profitable trading is trend-trading.

 

If you want big profits, you want  big trends, and to trade long-term.

 

Your boss may have some issues about sticking with his positions and may be trying to justify his trading style.

 

You might refer him to this site or to a Workshop.

 

You might have issues thinking for yourself, preferring to look to your boss or to me for answers. 

 

You can take "wanting confirmation from others,"  into the process as a starting point.

 

 

 

 Confirmation

 

can be a function of commitment.

 

Clip: http://www.towardsthegoal.com/

images/peopleandplaces/confirmation.jpg

 

Fri, 20 Feb 2004

 

Number of Days Breakout and AHA


Hi Ed,

Thanks for your FAQ reply on "#-days breakout".

The history of confusion and final AHA goes like this.

A few years ago, I managed to get hold of [Some Rules for Trading].

Without any back-testing, I started using the complete system for my trading. A mechanical trading approach is really a new concept to me. And since I have not been successful with my pure fundamental analysis approach, I allowed myself to try it out without any testing.

The initial trading result was not good. I got whip-saw a lot, sometime after the initial position, sometime after the 2nd, 3rd or 4th additional position. The feeling of being kick-out after the 4th pyramid entry really drive me mad and fuming (I have no idea of TT at that time). I calculated that my loss per trade increases from initial 2% to 5% if I were to be stop-out after the 4th pyramid entry. I realized that this original system does not suit me. It too aggressive for me. I need to tailor it to suit my character and personality and my stomach ;)

I stop trading. I browsed through my trading diary (I kept a record of all my trades) and re-read the [system rules] many times. I had insights and aha! I noticed that those trades that were successful have certain chart pattern  like reverse-head-and-shoulder, trading range and round-saucer bottom. I suddenly realized that my interpretation of the system entry and breakout might be wrong ...

To me, the [description] is ambiguous, it causes my confusion ... it is this kind of price pattern that I got whipsaw a lot. Later I discovered that I had brought them at the top of trend. This was as much as the price could contain for the time being. And correction was due, and kick me out.

I made the following minimal changes to the turtle system:


(1) entry - use breakout from more successful chart-pattern like trading
range or reverse-head-and-shoulder. Breakout from chart-pattern that has
price trending straight slope up is ignore.


(2) adding position - position is added after a new breakout if and only if 8-days low has occurred preceding any new breakout.


(3) use end-of-day breakout instead of intra-day breakout as mentioned
by Curtis.

The new trading system really suit me well. I do not need to stare at the quote machine, I gain personal time and freedom and my account grow. My concern at that time was a quote from Richard Dennis during a interview in Market Wizard. Richard Dennis said that most of his profit derived from one or two winners and he urged his students to take all signal triggered. My worry is what happened if the winner of the year does not have the chart-pattern I am waiting for? I will miss the run up! No more profit!

The ... confusion was not solved and the worry of winner run away is ignored. My new trading system has done quite well and I intend to stick to it.

This matter re-surface when I heard [about another] trading course. I did not attend his course but I did browse through his website .. [and it has different rules].


I notice the discrepancy between the two [systems].

All of a sudden, I realized that [one of the systems] not be complete ...

This curiosity is aroused again when I read your FAQ reply on the "trading range" triggered entry. Which is very similar to my entry system. That is to enter when breakout of trading range. I was so eager to ask you what if there is no trading range (hoping to get some ideas from you) when later I notice that you said, it one out of the many ways.

Still my concern is what if the winner of the year does not have those chart-pattern. It will run away from me. I try to feel the feeling of missing the move. My stomach get a little tight and cramp, that same feeling which I used to have when my buses or trains run-away. It dissolved, and AHA! I tell myself, it okay to let it run-away ... just wait for another one ... I cannot stomach that many whipsaw before I finally find those kind of winner!

Thanks Ed! You're great teacher!

You not only seem to want the perfect trading system, you seem to want it to appear as a definite set of rules.

 

Typically, sets of trading rules, such as you find in books and on internet sites are ambiguous, even internally conflicting.

 

Even if you could find a set of rules that you can compile into code, your program would likely guide only a sub-set of your actual trading process.

 

For example, essential trading tasks include selecting the markets to put on the system, determining the overall and individual portfolio risk, selling instruments to make room for more promising ones, picking  points at which to roll contracts and at which to enter a new customer, etc ...

 

If you notice feelings of desire for the "Holy Grail" or feelings of wanting someone else to take responsibility for your actions, you might take these into TTP.

 

For example, you might take the feelings you have in your stomach into TTP as a starting point.

 

 

 

Your Actual Trading System

 

is the set of feelings

you are unwilling to experience

 

Clip: humantree.com/ photography.html

Thu, 19 Feb 2004

 

Still Here - Riding Strong Trends

 

Hello Ed,

I just wanted you to know I am still here and still enjoying FAQ. I have been mostly reading FAQ lately and experiencing not asking questions.

One stock I bought, [Symbol], is doing good so far. It kind of surprised me with how fast it has moved!

Have you tried to get on any radio or Television shows promoting your method and upcoming book?

I put a picture I took of Lake Tahoe in the background of my web site. I snapped the picture the week of the October workshop. I did not realize how nice it came out until recently. My friend made it the background for his computer screen. If I do good with my trading I am going to buy a house there someday.

The site is just some links to help guide my internet use. www.universalking.com 





FAQ spreads more by listening than by talking.

 

I expect radio and TV to pick up on it at just the right moment of now.

 

 

 

Close-up of TTP Marketing Tool

 

TTP Spreads by Receiving Others,

not by telling them what to do.

 

http://graphics.stanford.edu/projects/

mich/more-david/david-ear-s.jpg

 

Thu, 19 Feb 2004


Workshop


Dear Ed,

I wish to attend the workshop you are hosting on May 7th-9th. I fulfill the additional requirements immediately following sending this email.

Regards,

OK.

 

You might even begin now, by defining your trading system.  See Workshop page.

Thu, 19 Feb 2004


Workshop

Hi Ed,

 

Is it possible that you reserve a place in the workshop for me? I would like to attend but at the moment I don't have the money to pay the fee. If I couldn't raise it till April 23rd, two weeks before the beginning of the shop and not attend, I'll inform you so that you can give the place away.


Best regards

See Workshop page for the procedure for reserving a place.

 

You might take your feelings about not having enough money into TTP as a starting point.  Concern about money can work against sticking to your system.

 

 

Rich and Poor

 

may both have concerns

about not having enough money.

 

Clip: http://members.aol.com/

carlycats/ccats/ccolor.gif

Thu, 19 Feb 2004

 

Simulation & Testing


Dear Ed Seykota,

I have a confusion!

What is the difference between simulation and testing a trading system with historical data.

In order to simulate a trading system, what do I need. All the historical data or am I going to create some new data from historical ones to simulate it.

Regards.

A simulation is an imitation.

 

You can program a computer to simulate your trading, by coding-in your trading method and imitating your trading over historical data.

 

Your actual trading may differ from your simulation due to:

 

differences between your computer code and your actual system

 

the degree to which you able to follow your own system.

 

 

 

Simulating Auto Crashes

can help engineers design better cars

 

and does not guarantee

to make you a better driver.

 

Clip: http://www.netcar.co.il/img2/milon/

54%20crash%20test%20simulation.jpg