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Ed Seykota's

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Sep 1 - 14, 2005

 

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Questions

(Quotes from Ed in Red)

Answers

Wed, 14 Sep 2005

 

Therapist uses TTP


Ed,

I work as a MFT (Marriage and Family Therapist) in CA, USA. I am familiar with a number of Cognitive Behavioral, and Rational Emotive Theories and Techniques that can be utilized and applied .


for the purpose of improving life satisfaction. I frequently use Existential Philosophy as a means of moving others and myself toward self-actualization. The first feeling I began to deeply explore through TTP was "Frustration". I became aware that my stomach was extremely upset. As I continued to experience the feeling I felt as thought I could actually become sick. As I continued to feel the feeling a strange phenomenon occurred. The feeling actually began to feel good.


Within a short period of time (roughly 15 minutes) the feeling that began as frustration evolved into a good feeling. It's hard to explain, but I began to feel good from the core of my being, and the good feeling seemed to move through my body and into my muscles and flesh. I became enlightened to a number of factors that contributed to the original feeling of frustration, and as a result of TTP have since made a few significant adjustments to my life including: A reduction in my teaching responsibilities at a local university; initiation of open and honest dialogue with my direct supervisor at a Mental Health System of
Care; and exploration of presently existing vocational alternatives. I do not know
if I will change positions, but the process of gaining insight and taking actions upon my feelings has proved extremely valuable in altering my current situation and reducing the level of "Frustration" I had been experiencing.

One other short experience...

I recently took a trip to Coeur D'Alene, Idaho. I have family there who has a beautiful ranch. The feeling that I examined using TTP was "Fear". Not being raised in Idaho, I have always been tentative to be around the horses. I attempted to not label the feeling as fear, but to simply acknowledge that I was having a feeling. I allowed myself to experience the feeling to its fullest extent.


Again I noticed that the feeling turned from its origination (initially labeled fear), into a good feeling. I want to emphasize that the "good" feeling is unlike that I have ever experienced. It became clear to me that I wanted to be around the horses and no alternative to action existed in that moment. I walked into the pasture and continued to experience my feelings as I stood among the equestrian beauties. They seemed to happily accept me in their presence, and I was very pleased to be there, beyond "fear".

Currently I am noticing that I'm not feeling anything "bad" lately. I seem to be content with my present circumstances, motivated to continue progress toward my goals, and comfortable with the growth that is occurring. I have seen improvement in my relationships at home and at work. I'll keep you informed of what happens next.


P.S. I noticed the Tribe (closest to where I reside) is Full.

Thank you for sharing your experience.

 

You might consider forming your own Tribe.

Tue, 13 Sep 2005

 

Wants Advice



Ed


Thank you for your time, I am new to trading and need some advice to learn how to trade, would you recommend the Turtle Trader's course, or the Online trading Academy, any advice would be appreciated. I have books to read and I need more. I want to learn the right way.

FAQ does not give advice or endorse commercial products. See the Ground Rules.

 

You might consider following along with TSP, link at the top of the page.

Sat, 10 Sep 2005

 

Already In

 

Nice Chart Book page!   

 

I already own five of these stocks.

I wonder if you have enough understanding of your trading method to formulate it as a system and perform a back-test.

Fri, 9 Sep 2005

 

Suggestion for Improving your Book

1. LIFE IS TOO SHORT TO BE SO WRAPPED UP IN YOURSELF!!

2. IT WAY OVERPRICED!! WHICH LEADS TO #3

3. LOWER THE PRICE !!

4. ACTUALLY, FREE IS BEST !!

5. EVEN THOUGH YOU LOOK LIKE HIM YOU'RE NOT DR. PHIL SO SNAP OUT OF IT.

You might consider taking your feelings to a Tribe Meeting as an entry point.

 

 

 

The Trading Tribe Book

 

Some people think it's too expensive

 

Others buy ten copies at a time.

 

Fri, 9 Sep 2005

 

Request Meeting

Mr. Ed Seykota,

I just finished reading Trend Following and am fascinated with your success. I would like to meet with you if possible the first week in October. Monday the 3rd or Tuesday the 4th would be great for me. Please let me hear from you as soon as possible.

Please tell me what you want to accomplish by meeting.

Fri, 9 Sep 2005

 

Links Don't Work


Hi Ed,


before all, thank you very much for the TS Project: I check every day too see if something new is available.


I think there're links to fix: I try many times and with different net browsers, but it seems impossible to visualize those images you put on the last references:

 

Exponential Averages and Comparison of Exponential and Moving Averages. The spreadsheet, too, is unreachable.

thanks again.

Thanks for the catch.  The links now link properly.

Thu, 8 Sep 2005

 

Intention = Result

 

 


Intention to Get Out



Intention to Stay In.

 

 

Clips:

http://news.bbc.co.uk/media/images/

40738000/jpg/_40738788_cars300getty.jpg   

http://news.bbc.co.uk/nol/shared/

spl/hi/pop_ups/05/

americas_katrina_hits_us/img/6.jpg

Yes.  Knowing when to hold 'em and when to fold 'em is essential in trading and in staying alive.

 

 

 

Intention to Grow

 

The government responds quickly to the hurricane crisis by rallying together to support a 6.4 Billion appropriation to expand the government.

 

 

Source: http://water.usgs.gov/osw/

pubs/FEMA.htm

 

Clip: http://www.cosy.sbg.ac.at/

~wdietl/diary/bay/2001-07/

wdc/congress-1.jpg

 

 

Wed, 7 Sep 2005

 

To Usher in the Football Season

A guy took his blonde girlfriend to her first football game. They had great seats right behind their team's bench.  After the game, he asked her how she liked the experience.

 

"Oh, I really liked it," she replied, "especially the tight pants and all the big muscles, but I just couldn't understand why they were killing each other over 25 cents."

 

Dumbfounded, her date asked,

"What do you mean?"

 

"Well, they flipped a coin, one team got it and then for the rest of the game, all they kept screaming was: 'Get the quarterback! Get the quarterback!' I'm like ... Helloooooo? It's only 25 cents !

Maybe she doesn't know that 25 cents in Sugar can make your whole year.

 

 

25 Cents in Sugar

 

is about $28,000 / contract

 

 

Clip: http://www.ps.uci.edu/

~tomba/ants/sugar.jpg

Wed, 7 Sep 2005

 

Radial Momentum = Cranky

Hi Ed, You might visit this URL http://www.crank.net/

antigravity.html

It is a website that indexes "Cranks, crackpots, kooks, and loons on the net." They list your Radial Momentum website as "Cranky". Apparently it has been listed there for nine months, but I only saw it today.

(Other sites received ratings including "Illucid", "Crankier", "Crankiest", "bizarre", and "fringe")

There is also a "feedback page" that lets you communicate with the webmaster of crank.net.

I receive numerous emotional objections to the Theory of Radial Momentum, almost none of them specifying any specific deficiencies.

 

Typically, a radical and correct theory receives disapproval for quite some time. 

 

Eventually a champion with scientific credentials comes along to support the theory and take credit for it.

Wed, 7 Sep 2005

 

Programmer Quiz

Here's something to do when the programming gets to be too much for you.

http://www.malevole.com/

mv/misc/killerquiz/

I wonder which type makes the better traders.

Wed, 7 Sep 2005

 

Stuff the Feeling


Hi Ed,

I return to the hotseat after a 6 week hiatus. During that 6 weeks I return to many bad habits and fail to honor my commitments. It is difficult for me to return to the tribe meeting because I am well aware of the fact I let down my tribe and myself.

I am on the hotseat to address the fact I do not stick to my commitment to eat healthy food and exercise on a regular basis. The tribe are well away of my situation. I tell them 'I am a joke' and 'this is all bull... They encourage me to get into the feelings. This just annoys me even more because as soon as I start to get into the feelings I want to stop. This is not new, in fact, a previous hotseat issue of mine even appears as an example in The Trading Tribe Book.

The tribe picks up that I really enjoy stuffing the feelings. This is difficult for me to handle because as the tribe encourage me to get into my feelings my natural tendency is to try and suppress the feelings.

 

I have an AHA moment realizing that putting food especially unhealthy, sugary food is an extremely effective way for me to stuff feelings. The fact I finally see the connection that I enjoy the feeling of stuffing the feelings is huge.

The hotseat session is extremely productive and helps loosen but not completely dissolve a very sticky (k)not.

Thank you for sharing your process.

 

 

 

Thanksgiving

 

provides an opportunity

to rekindle family conflicts

and then stuff the feelings down.

 

Note: Tryptophan works best

on an empty stomach. 

 

Post Turkey Tiredness

likely has more to do

with over-eating

and situation-escape syndrome.

 

Clip: http://www.yorku.ca/ycom/profiles/

past/aug00/current/dept/

dispatch/images/a-dsp10a.jpg

 

Wed, 7 Sep 2005

 

Trend Following in Emerging Markets


Dear Ed,


I think trend following is probably the best approach to trading in harmony with the markets.

 

However, I have a mental block against using this approach to trading Emerging markets securities ( where the liquidity always seems to be abundant when one wants to enter the trade , but evaporates when one needs to exit.

 

While this is true for any market, it is highly so for emerging market variety). Is there a practical way to trade the trend in such markets, where there is a sudden shift in trend from up to down with very thin market conditions.

You might consider adopting a longer time-frame for your trading.  See TSP above.

Tue, 6 Sep 2005

 

Charity vs. Welfare

Private charities have been more successful than government welfare has at actually helping people.

 

Private charity requires a different attitude on the part of both recipients and donors. Recipients learn that private charity is not an entitlement but a gift carrying reciprocal obligations. Donors learn that private charity demands they become directly involved. There is no compassion in spending someone else's money--even for a good cause. True compassion depends on personal involvement.

Yes, as societies decline, welfare replaces charity, law replaces ethics, redistribution replaces enterprise, government replaces family and Homer Simpson replaces Ben Cartwright.

 

 

A Man with a Rifle Riding Through Town

is a common sight 100 years ago

 

Not really very politically correct

these days.

 

Clip: http://www.gunslinger.com/west.html

Tue, 6 Sep 2005

 

Wants a Link on FAQ


Hello,

I recently came across your site, The Trading Tribe and really enjoyed reading it. I've added a link to it on my blog roll. If you find my content useful and would like to link back, it would be much appreciated.

FAQ does not Trade links or make recommendations.  See ground rules.

Wed, 7 Sep 2005

 

Looking for a Tribe


Hi Ed,

I am wondering if there is a TT in [City] since I am here for a couple of weeks.

Check the Directory.

Tue, 6 Sep 2005

 

Tribe Meeting Feedback

Hello Ed,

I awake early in the morning with uneasy feelings and anxiety. I notice sweaty palms and just general tension throughout my body. I go to the gym, it’s more of the same, I get a sense of short breath as I work out. It’s a tribe meeting day and for the first time since the last meeting, I feel nervous. I work out and then head to the airport, visions of Incline Village fill my mind and feelings from the morning dissipate. I feel relaxed on the flight to Reno and drive to Lake Tahoe.

I arrive at Lakeshore in the early afternoon, greet my fellow tribe members and meet two new faces. Ed and another Tribe member bang out some melodies on the banjo and guitar, the music relaxes me, my state of mind falls into a serene mode, it feels good.

The tribe kicks off the snapshot process. Members go through their process while the rest of the tribe ask questions, prod for details and lend support. As I review my snapshot for the group I get a sense of clarity, my snapshot does not change from the previous meeting; although, it gets more vivid in my mind.

Since the last meeting I find myself thinking about my snapshot and specifically about one comment from a fellow member about my lack of “feeling” when describing it. I discover that emotion was lacking because of my lack of willingness to just step into the process that leads to my snapshot.

Over time, my trading results are weak at best, and in thinking through my snapshot I discover what I label a build up of negative energy that stands between me and my snapshot. My snapshot is one of me successfully completing 20 trades. I hold in my hand a trade report detailing trades 1 thru 20. There are several columns on the report. One of the columns is a Profit/Loss detail for each trade with a Total Profit number at the bottom, the Total/Profit number is green, signifying profitability.

The adjacent column details entries and exits generated by my trading system. This data is used to generate a variance report, or the delta of my actual trades and the system trades. Variance for each trade is negligible.

I have HUGE smile on my face as I hold the report with my right hand slightly bent down and my face tilted up slightly staring at the GREEN! Just like a professional body builder gets his entire mind and body into a pose to show his right bicep during competition, my entire living being and energy are “into” my successful 20 trade report. As I see my snapshot now, I begin to feel it, to sense it, to be it, I get emotion, I get excited, I want it NOW!

The remaining members go through their respective snapshots and one member reminds another of an incomplete snapshot that has in part to do with the inability to swallow a pill.

 

The “reminded” member agrees to commit to a snapshot of him swallowing a pill as opposed to chewing it.

The snapshot process takes longer than expected, but with the good discussion no one notices so we break late for dinner.

The tribe joins Ed in drumming after dinner and the tribe checks in after the drumming dissipates. The tribe checks in and Ed selects me for the Hot Seat. I mention sweating palms and that is where it begins. Once again, I hear, “more of this, yes, more of that! Great, Do more! Back flip, stretch, bend, more, etc … good work!”.

In my previous hot seat session, I get images of my family, one specific image stays with me, it’s my father in a pose that I define as the judge pose, skeptical look on his face, cocked eyebrow, arms crossed, one hand supporting his chin, the total judge pose if you will.

I recall, from my previous hot seat session, that when my body begins to take over I get that judge pose image of my father and I just stop. This time in the hot seat, as my father in judge mode flashes, I yell out “there’s my dad” and Ed says “… be your Dad! Pose like him, cock that eyebrow! There you go! MORE! MORE! MORE!”. Then I get a sense of darkness as I hold my breath, it’s dark, very dark. I let go and the room is before me again.

I then get back into myself, hold my breath and it gets darker, very dark. I begin to see, I begin to see eyebrows! Like multiple sets of eye brows, two dimensional, animated sets of eyebrows. They’re just there, no face, no eyes, no nothing, just eyebrows. They move almost like objects move in an animated movie, the moving eyebrows, no emotion, no feel, just eyebrows moving in darkness. Funny side note, the tribe did not link the eyebrows I was envisioning on the hot seat with my fathers judge pose.

I keep getting into the pose where I hold my breath and see the eyebrows. I feel intense as I build up to the point of seeing the eyebrows, I see them, they look back at me and then I’m like awake. I get back into myself and my right hand begins “go way” movements, telling my father to go away, I tell him specifically to go away.

 

Then in an instant, my father goes from this huge image in his judge pose to this little doll like, miniature size image that I push down from a high level with my hand and arm. I just keep pushing down and then the little doll version of my dad is sitting on my left shoulder, looking forward, as if he does not even know where he is at, he just sits there on my shoulder like he’s along for the ride now. I come back and we do a check out. My dad is still on my shoulder. When I go to get the judge image of my dad, I see the little guy on my shoulder instead.

A fellow member notes that I’m very visual in describing what I see during my hot seat session. Ed points out that I may be limiting how deep I go into myself by taking mental notes of what I’m seeing as I go. I take note of the latter.

The final hot seat session of the night is remarkable and unique in the sense that I see it go from snapshot to hot seat to successful completion in one day. As described above, a fellow member cannot swallow a pill, chews them instead. The member agrees to take this into the hot seat.

The member begins his work, tries to swallow, then gags up the pill. This is repeated several times without success, like 4-5 times. The member then recalls as a kid an instance where a doctor tricks him into swallowing a pill (by shoving it down his throat), and his father as the protector, goes along with the doctor. The member gets into more work and more work. More pills and water without success. After extended hot seat work, the member tries one more pill and it works, he swallows it, just like that.

I cannot convey the AHA I get in seeing this member go from start to finish on an issue such as this. The fact that another member fished this issue from an unresolved snapshot was incredible to begin with. And then for the member to commit to swallowing the pill, after almost vomiting and potentially inflicting serious hurt on himself, was remarkable.

Thanks again Ed and fellow IV TT members, your work, effort and support are greatly appreciated.

Thank you for sharing your process and your commitment to the work.

 

 

 

To Find this Clip

 

I browse eyebrows.

 

 

Clip: http://www.studiomark.com/

april2001images/lifted-eyebrow-hs.jpg

Tue, 06 Sep 2005

 

Thank You


Hello Ed,

Today I'm returning from vacation, and I wanted to say thank you for the time we were able to spend together.

 

I've been doing a lot of reflection as the result of our conversation. I am enjoying the introspection from a different angle. From frustration to fear, I've been feeling and examining the experience, insight, and value.
Interesting.

When you are up for a [bike] ride in the Sierra's, I know an expert guide, who would be happy to take us on a personally tailored adventure. Bring a camera, were going off road! Remember, there is nothing to fear but fear itself.

Thank you for sharing your process.

 

 

 

Expert Guide

 

Clip: http://stellargraffiti.com/

My%20Pictures/Be%20A%20Bicycle%20

built%20for%20two.jpg

Tue, 6 Sep 2005

 

Workshop

Hi Ed,

I have been reading about Trend Following and am getting fascinated by the entire
subject and also with what you have done in this field.


I am 50 and live in the Bay Area, and am eager to learn and use these techniques,
when will you be holding the next workshop?

I present workshops in response to demand.

Tue, 6 Sep 2005

 

Book ?

Ed says on a TSP page:

For the sake of clarity in this book, I do not refer to three-day averages. I refer to three-point averages.

excuse me asking: what book?

I am considering publishing the findings from the TSP project into a book.

Tue, 6 Sep 2005

 

Searching for a Tribe


Mr. Ed Seykota,


It is my honor to write you. I am not good in English so please forgive me for any mistake. I read about you and now came to know that a beautiful forum is going on.

 

I am trying to find a TT meeting near [City], is there any ? I admire that you are contributing some thing what you believes in.


Best of all for you.

You can check the Tribe Directory, above.

Mon, 5 Sep 2005

 

Chart Page

Dear Mr. Seykota,


I watch your interesting new chart page with these powerful short-term charts.


What do you intend to show by it?


How do you screen for these charts? Do you use 6 month breakouts?


I appreciate your wisdom and insights. Thank you very much!

I have several initiatives underway that I see converging later this year into a trader/client support system for the Trading Tribe.

 

I am using simple trend strength indicators.  Most filters give similar results.  If you have a screen you like that does not duplicate the charts on the chart page, you might like to send it to me.

 

 

Screens Keeps Some Things In

 

and some things out

 

 

Clip: http://www.semguy.com/gfx/

screen.jpg

Mon, 5 Sep 2005

 

Secular

Dear Mr. Seykota,


You use the term "secular trend" in your explanation of exponential averages.
What is the time frame of a secular trend?
Yours sincerely.

A secular trend, literally, lasts from century to century.  Figuratively, secular refers to the main trend and ignores the short term corrections.

 

 

Secular Trends

 

tend to persist

 

Clip: http://mwhodges.home.att.net/

spend-regulation.gif

Sun, 4 Sep 2005

 

Conflicts

Ed-

I have a problem.

I trade flat-base breakouts of NASDAQ stocks. Initial candidates are obtained by scanning the NASDAQ stocks whose present close is a new 8 week high close price. Candidates are further analyzed using liquidity characteristics, industry group, etc.

Entry is based on Buy Stop Market slightly higher than the previous day's high, to insure trend reliability. If the trend is going to continue, my order is activated. This prevents buying one-day wonders that may not be truly in a new uptrend. This "filter" is used to enhance reliability.

I use a 3/9 EMA crossover for trade exit. My own personal back-testing has shown this to be a reliable signal for exit. Typically it occurs 14-30 days after the breakout day.

The problem is that I place a Sell Stop order, usually 5-6% below my purchase price, to protect myself against losses.

 

Many times, intra-day price noise will activate my order and I will be out, only to see the stock to continue its advance.

Ed- how do I convince myself to loosen up my Sell Stops or maybe not even use them (with the exception of the 3/9 EMA) ?

Historical testing is a pretty good way to determine which system works best.

 

Attending Tribe Meetings is a pretty good way to develop consistency in following your system.

 

 

 

Trading Systems

Don't Eliminate Whipsaws

 

they just include them

as part of the process.

 

Mon, 5 Sep 2005

 

TTP Workshop in 2006


Are you planning a TTP Workshop for 2006? If so, what dates are you considering?

For now, you can follow along with TSP, above.

Sun, 4 Sep 2005

 

Petro-humor

 

Chief -

 

You might enjoy this cartoon:

 

 

No, officer, they left the cash

and siphoned out the gas.

 

You might enjoy this:

 

 

How to Time the Market

 

Your Email Arrives

just after the top.

 

Sun, 4 Sep 2005

 

Using Tribe to Stay on Task


I like to buying the historic high breakouts from a 55 / 20 day range with appropriate risk management parameters - ( within tolerances of my stomach lining ).  This has transformed my trading results since I started managing money professionally 2 years ago.

My local tribe keeps me on course by helping me feel and enjoy the emotional component of my trading / life system, while I cruise along the highway of right livelihood.

I can never thank you enough Chief; for being the motivation and providing the inspiration to remain focused since most of the past 12 years of my trading.

Thank you for sharing your success story.

Mon, 5 Sep 2005

 

Smaller is Better

 

In relation to the Trading System Project, I have found that improving frequency (CAGR/Dr-Dn) can be achieved by reducing trading size in proportion to the current drawdown.

 

Therefore, when we are in drawdown we limit the extent of our drawdown by trading smaller and smaller until the drawdown is recovered, upon which we resume full trading size. This has the effect of reducing the overall return slightly, but also reduces drawdown even more dramatically, resulting in an improved frequency.

Maintaining a constant trading size (the fixed-fraction method) will deliver a superior return but higher drawdowns and inferior frequency.

Your language, "I have found,"  "can be achieved" and "will deliver" indicates you still are at the theoretical stage with your idea.

 

If you have some A/B simulations showing a comparisons between a benchmark system and one with your modifications, send the results to me.

 

 

Some Things

Like Pants and Trading Accounts

 

 Seem to get bigger and smaller

while we stay the same.

 

Clip: http://www.equinox-products.com/

images/weight/Pants%20Getting

%20Smaller%20Syndrome.jpg

Sun, 4 Sep 2005

 

Confusion as an Ally


Dear Ed,

Regarding my Thursday, August 18th question about deadlines.

You are a mind reader or something! You said I should take my feelings of impatience to my Tribe as an entry point.

1) At the time of my email question, I was very impatient about making money due to my unemployed status.

2) I am ending a business venture that I embarked upon this summer and have been in a hurry to finalize the transfer due to being at some risk until Tuesday September 5th.

and

3) You are right again..... I can't wait to see how your trading system comes out! Yahhoooo!

I actually hate deadlines and had many of them at my former place of work.

I must wait for a signal to place my trades and may cut losses within hours or minutes. A deadline does me no good when I am just reacting to the market. So I am happy with your answer.

It is like you can see into peoples brains or something! Your brain power is scary!

I don't have a Tribe here in Connecticut yet, so I usually call [some colleagues] over the phone once in a blue moon and they straighten me out good.

 

One blew my mind by getting me to flow with my feelings over the phone a few months ago. I did not know he was doing it at first. I was thinking to myself "Why is he letting me think and talk about what I want? Nobody does that!" He is very good at it.

Thanks for bringing the chart section back! Again ... just when I needed to clarify my thinking you have the chart section back on your website!

I also had a HUGE trading breakthrough due to your help. It is beginning to show up in my account. The breakthrough just happened last month so it is still early and I want to be sure it works over a longer time period.

 

A feeling I had at Breath Works keeps signaling me and surfacing when I should close out or reduce a trade. It has been accurate so far but I may need some help with one aspect of the feeling.

The feeling I get when my trade is not working is what my father described to me months and years after he received shock treatment.

 

Confusion, anger and stress and numbness of thinking. In the past these feelings stopped me from closing or reducing a trade that was not working. I was mentally paralyzed and took bigger losses than I should have due to inaction.

 

Now I can step out of the confusion somewhat and close the trade. The feeling still lingers sometimes hours or days though. I would just like to be able to step out of the feeling with more strength. You got me this far can I just go a little more? What do you suggest?

Thank you for sharing your process.

 

 

Anxiety can be an Adversary

 

or an Ally

 

Clip: http://www.luc.edu/faculty/

jreymon/testanxiety.gif

 

Sun, 5 Sep 2005

 

Needs Support


Dear Mr. Seykota:


First of all I tell you something about myself and my background then about my vision.

I am in my mid twenties and study economics. I grew up in a poor family, in many respect (personal problems, addicted to alcohol, debts, and recently divorced). During my trainings I always had to work to finance myself (even then when I went to school with 12 to buy my books). Most of my parent’s traits seem to transfer to my brothers and sisters. They have the same attitude about life. Although it might be easier for me to become one with them I have to be willing to lose all of them in order not becoming one of them. This makes life even more challenging.

I always do things on my own without the right support and even now people tend to tell me that your chances are very low to become financially independent. I want to have my own business and be responsible for myself. While this sounds vague I read some books a few years ago that lead me to the mental attitude necessary to become a professional trader. I am very interested in this subject and it seems as if addiction is transmittable this is it where it leads me to.

The more I read the more I feel trading is what I want. Preserving capital is like preserving attitude. Financial independence is one motive I am aware of like I am guided by greed and it might be a difficult obstacle to become a trader even though it is a good motivation. I focus at the process and make my first experiences.

At first I have interest and decide to learn everything I can get (read books, attend seminars, write exams).

Second I know or better I think I know almost everything and I am ready to step in (open an account and trade).

Third I realize that I don’t know anything (lose my money), anything is possible and unpredictable.

For me it sounds like an inner calling or is it just that feeling that people like me have shortly before they get into trouble when facing the markets.

Doing business or whatever in life is always easier with the right support.

But where to start … STOP, I tell myself – just start.

I see myself in front of a screen buying and selling different financial instruments successfully in my office somewhere out in this beautiful world.

Strange to say at least right now I pay the price and go my way.

English isn’t my mother tongue, so please excuse for mistakes.

You might consider:

 

1. joining and/or forming a Trading Tribe in your area. 

 

2. Following along with the Trading Systems Project, above.

 

 

Trading as an Addiction

 

is quite different from

 

Trading as a Businss.

 

Clip: http://www.drug-rehab.com/

images/heroin_pic.jpg

 

 

Sun, 4 Sep 2005

 

Trouble Following Systems

I think we need different systems for each market and market moment (range, market up or down) and a key to change the system to use. The key is not other program or algorithm but our experience (I don't tell a second guess but experience). Why?

You are a great trader and I think you must have a great trading system. You can teach me everything about the system and the market but If I don't have the experience I can "see" the market and I continue don't understand.

 

I think experience is more important than a great trading system. So, I think we need to use our "feeling" experience. Some friends tell me I'm wrong and talking about you. They tell me you are the best because we don't use the feeling only the system.

Another reason to the system trading don't work well forever I think is because the way the people see the market change. The people are the same, the market too but the way we see is different because some things, gradually change.

 

Today, the investors react to some things because they are contaminated for the past. They don't know why they do that or react thus, but it always was thus therefore make thus. But I believe they repeat this acts but with little different, with out objective. I give you a funny example:

What is your opinion about the experience (feeling) in trading?

Can your experience take you out of the trade without a system signal or vice versa?

You might consider taking your feelings about following orders to your Tribe as an entry point.

 

 

 

Rules Restrict

 

and protect

 

 

Clip: http://www.gov.calgary.ab.ca/

police/kids/images/bike.jpg

 

 

Fri, 2 Sep 2005

 

Starting a Tribe

Ed,

Two questions:

1- How I can buy your book "Trading Tribes". I search in Amazon and other sites and nothing?

2- What we need to starting a "Trading Tribe in [Country]. [We are] searching ways to promote the trading psychology. I think the TT is a good way for this. Can you give me a highlights about this method and process?

1. See the link to Trading Tribe Book, above.

 

2. See the link to The Trading Tribe Process, above

 Fri, 2 Sep 2005

 

Progress Report


Hi Ed,


I want to write a quick progress report, since the [City] tribe exists for almost a year. I am very thankful for being part of such an amazing group. In the past 12 months I find many issues I am not even aware of before. I learn that I do struggle with a lot of the emotional baggage my parents leave me.

 

My relationship with my mother deteriorates, as I am less willing to be involved in her drama. I mention your work to her and am excited to see what happens next. I also speak to my father for the first time in the last 8 years.

I am very happy to report that after I take my feelings about loneliness and relationships into the tribe I find a wonderful and amazing girlfriend, who I connect with on a deep level. I am also excited about developing my first trend-following system after I meet a programmer and we find that we have the same intentions.

This past year brings a lot of positive change and I feel I grow more than ever before in my life. Thank you for sharing your wisdom.

Thank you for sharing your success story.

 

 

Happy Couples

 

seem to emerge from nowhere

 

when people are ready.

 

 

Clip: http://www.doc.ic.ac.uk/~kpt/

CapeTown/981124/Hazendal%20A

%20Happy%20Couple.jpg

Fri, 2 Sep 2005

 

Exponential


Hi Ed,


hope all is well.


I have a question regarding the results you display for the trading systems project. For the simple EA trading system you display three runs. What is the formula for the exponential you display as an overlay on the equity curve?

See the TSP page at Reference Library.

Fri, 2 Sep 2005

 

Chicken and Egg

Ed-

I have been doing some extensive study on hedge funds and all indications are that the aspiring hedge fund manager needs at least a 3-year track record before he can attract large investors.

This brings up a "what comes first" the Chicken or the Egg question.

How does one establish a 3-year track record?

My intended plan was to form a RIA LLC company, with family and friends as investors, and using trading performance from "Day 1" of the formation of the LLC company, that would be my track record.

The style of this fund will be a combination of trend following and fundamentals, trading US equities.

Obviously I want to comply with legal / SEC requirements and be above board with everything.

Ed, thanks for any input you can pass along.

The fish likely predates the chicken-egg cycle.

 

I wonder what you mean by a combination of trend following and fundamentals and how you intend to reconcile inherent conflicts between these methodologies.

 

You might like to follow along with the tutorials on the TSP page.

 

 

 

Chickens and Eggs are Both New

 

relative to fish.

 

Clip: http://www.londonstimes.us/toons/

cartoons/joel_chicken_or_egg.gif

Fri, 2 Sep 2005

 

Mandelbrot

Dear Ed,


I appreciate your work, your thoughts and your approach to the Technical Analysis and mechanical and automatic system; it’s an inspiration to me.

I use the a neural network system trading programming with Point & Figure patterns to generate buy and sell signals and a fractal indicator based in market theory from Prof. Mandelbrot, to know when the trend is over.

 

In money management I use some anti-academics theories, I never straight a stop loss to carry a biggest position. I put the stop loss longer enough to know if I will stop I was really wrong, independent the percentage of eventual loss. If percentage of eventual loss is higher I prefer reduce the allocation capital to this trade but never straight the stop.

So, I’m email you not for talk about my personal trading style but about the “Top Trader Championship” a (real money) Trading Game Competition.

Your name is synonymous of seriousness, ability and credibility.

The seriousness of your vision of the stock market and the world is similar to the thoughts I have about it. For this reason I think your teachings and sayings can help our traders in this competition. In Portugal everyone knows who is Ed Seykota and everyone want know a little more about this famous Top Trader.

We want invite you to participate in the competition like our special guest (Top Trader).

If you can’t participate for any reason (I know you are very low profile) we want ask you if is possible you reply some question about trading and yourself to a interview to the competition website and the most prestigious Portuguese journal (“Semanário Económico” Seminary Economic)?

I do not know of a Mandelbrot Indicator.  If you have one that survives back-testing, I'd like you to send me some simulation studies so I can post it to TSP, above.

 

Thank you for your invitation.  I decline.

Thu, 1 Sep 2005

 

Bluegrass Music

Hi Ed,

I gather from reading your website that you are a fan of bluegrass music. I was hoping that you could recommend some real good bluegrass musicians I could enjoy?

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