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December 1-10, 2003

 

Questions

(Quotes from Ed in Red)

Answers

Wed, 10 Dec 2003


Pain and Trading

Ed,


Thank you for your reply.

your comment struck me since it was the pain I felt from a single deviation from my plan that motivated me to write to FAQ.

The pain I felt from not accepting my system was much more painful than that from missing a wave (as part of the plan) or a whipsaw.


I believe I wrote FAQ to neutralize this pain.


I've been thinking as I type and I have a question.

If trading is easy and boring, and I (or Fred?) want or need to experience pain for some reason, then the only way I can do so is by not following the plan.

This being true, and pain being a natural human emotion, are periodic deviations a natural part of the system or can they be neutralized before they manifest themselves?

if I am way off here, hopefully I am providing more entertainment than paddleball.

Yes, you identify the mechanism behind continuing to set up dramas, in order to experience unexpressed feelings.

 

An alternative is to fully experience the feelings intentionally, with TTP.

 

 

Experience it Now

 

or set up dramas now.

 

Clip: http://www.medlina.com/pain.gif

 

Wed, 10 Dec 2003


Nuclear Engineer on Eurex

 

Hey, Ed.

I'm a former Nuclear Engineer who now trades Eurex and CBOT yield-curve spreads on a full-time basis for a living. Just checking in and saying Hello.

Some very bright scientists prefer  figuring things out to riding trends.

 

 

 

Proton:

"I'm a fundamental particle,

so I know I'm right."

 

Electron:

"You seem so positive."

 

 

Clip: http://www.eskom.co.za/

nuclear_energy/fuel/atom.jpg

Wed, 10 Dec 2003


Swing Trading


Is - in your opinion - a mechanical long-term trend-following a superior trading strategy to short-term (1-3 days) swing-trading? If so - why ?

I trade a long-term trend-following system (entries happen not very often because I enter on 55-days breakout) on forex but I feel very strong temptation to engage in swing-trading. The unknown inner voice tells me just to try it when my system is out of the market.

Best Regards

FAQ does not recommend specific parameters.  See Ground Rules. 

 

Short-term systems tend to succumb to transaction costs.

 

You might take your urges for swing-trading into TTP, as an entry point.

 

 

Swinging His Weight Around

 

 

Clip: http://max.levien.com/

max-swinging.jpg

 Wed, 10 Dec 2003

 

Change Based on Feedback

From FAQ Site


Hi Ed

I saw the feedback from one of your readers about this Livermore quote on our site:

"The stock market moves ahead of world events. The stock market is not
operating in the present, reflecting the present; it is operating on what is
yet to be, the future.
"

Our language implied it was a quote you would support. That was a [xxx]
mistake that has been corrected! :)

All the best!

Yes.

 

 

Wed, 10 Dec 2003

 

Capturing Maximum Percentage

hi Ed -

I wrote to you quite some time ago and am
happy to report that I'm doing better than ever ... my COMMITMENT to trading successfully is paying off ... it made all the difference. (surprise surprise!)

I have a question for you ... obviously, buying the low and selling the high of any trend is simply not going to happen ... so based on your experience, what do you think is the realistic maximum percentage of a trend that a good trend following system can expect to capture?

I'm trying to fine tune my methodology to capture the largest possible percentage of any given trend, but obviously, the more one fine-tunes, the greater the risk of getting stopped out too early ...

it seems to me that if one can capture 50%-60% of a long-term trend, he's doing pretty well ... is attempting to capture more than that a pipe dream? at what point am I getting into the realm of quickly diminishing returns?

thanks ...

Trend Traders tend to capture a lot of the major trends and lose on the small ones.

 

I don't know how you intend to use your percentage metric.

 

In order to capture 50% of a trend, before it ends, you would have to know the ending point, in advance.

 

If you really have that information, you might as well go for 100% of the move - or even more, if you can guess all the wiggles - the sky's the limit.

 

You might take your feelings of wanting to get the largest possible percentage into TTP.

 

 

 

If You Can See Clearly

that the Sky's The Limit

 

your neck might be exposed

 

Clip: http://www.cs.princeton.edu/

~sudhakar/pics/general/

sky-dept-limit.jpeg

Wed, 10 Dec 2003

 

Journaling Feelings

I keep a detailed, feeling intensive trading journal. This is a new experience for me and it is invaluable in identifying issues and feelings to take to the process.

I celebrate my feelings and recognize their positive intentions.

 

I am also starting to notice that there are very subtle differences between feelings that arise as part of long standing dramas and feelings that arise as protective warnings.

 

Experiencing these feelings helps me to dissolve dramas, and also to see when my feelings are telling me that something in my systems might be improved upon.

Sometimes experiencing feelings leads to an AHA, sometimes to dissolving Dramas, sometimes to rejuvenating my trading methods, and sometimes just to experiencing feelings.

It feels wonderful to begin to let nature take its course. Though the journey never ends, the choice to depart on the voyage makes all the difference in the world!

Thanks, Ed.

Yes.

Wed, 10 Dec 2003

 

Experiencing / Analyzing


I'm not a tribe member but from what I understand from the example given on your site, it seems that a past experience which was negative or traumatic is re-emerging under our radar which we don't want to experience again?

 

And when that experience is remembered, it loses its grip on you since now you know the source?

 

What I don't get, is what fully experiencing a feeling has got to do with it.

 

If I have bad anxiety, which I always have, in the moment I'm aware of what's happening to me. Its uncomfortable for sure, but I am fully aware of the bodily reactions I am having such as shortness of breath and sweaty palms. But that doesn't seem to do anything at all.

 

It stays like it always does. No memory is retrieved nor is there any kind of aha. Am I just not seeing something that another would see while its happening?

Intentional experiencing of repressed feelings tends to  transform them into Aha's and tends to disappear the dramas surrounding them.

 

A Tribe can help you stay on task, since repressed feelings are, by nature, not particularly pleasant to experience.

 

Remembering an experience, talking about it, analyzing it, even writing about it does not seem to promote the abreaction.

 

 

Thinking About a Sneeze

 

is not the same as sneezing.

 

Clip: http://www.rockford.uic.edu/

toyourhealth/aprindex.html

Tue, 9 Dec 2003

 

Aha - Boredom


Ed,


Ed Says: Everybody gets what they want out of the market.


I wanted excitement.
I wanted to show how smart i was.
I wanted money.


I did not make money.
I lost money.
consistently.


I have done my homework.
I have a plan.
I want to follow my plan.

I want to follow my plan because I have done my homework and Ii understand my plan will work.

missing some waves and losses from whipsaws are an organic part of my plan so there is no pain when they occur.

I follow my plan -
and I make money.

trading is remarkably easy -
and boring.

Ed, thank you for your insights and honesty in sharing them with others.

Best regards,

Yes, pain may arise from not accepting the system.

 

Also, from not accepting boredom.

 

 

 

The Positive Intention of Boredom

 

might be to find something

interesting to do

 

like paddle-ball,

playing the banjo

or running a web-site.

 

Clip: http://www.unitedcommand.com/

toons/boring.gif

 

Tue, 9 Dec 2003

 

Dream Terror 2

see: Dreams Mon. 1 Dec, 2003


Fear. Of what? Not sure, but it is enough to keep me from going on and being there with the feelings.

 

Too scary, too creepy. I judge those feelings as unbearable and I am unwilling to continue Ö my twin dogs as Ed says. I donít know what death or going insane feels like but if I had to guess it would be something akin to what Iím experiencing in my semi-lucid dreams.

 

It frightens me to death. Two days running I was able to experience in a half sleep, half waking state such weird sensations of losing control, of something alien inside that writhes in terror when I focus my awareness on it. The writhing and terror is what I feel but it somehow seems to be me and not me at the same time.

 

It is very hard to describe. Iím getting closer but the fear of the unknown keeps me at bay.

Does this sound familiar to anyone else out there? Are there any tribe members with similar experiences?

 

I ask these questions as a way to confirm that Iím on the right track (in the absence of willing receivers) and not mentally deranged or possessed by an evil spirit.




The Twin Togs

 

 acceptance and willingness,

guard the gate to AHA.

 

TTP means the Trading Tribe Process;  TTP requires an intentional community, with members who commit to helping each other stay on task with experiencing their feelings.

 

DIM means Do It Myself; the results you are getting are consistent with the DIM process.

 

 

 

DIM

 

Preferring isolation to community

and agreement to growth.

 

Clip: http://www.ai.mit.edu/

~emax/alone.jpg

 

 

 

Tue, 9 Dec 2003

 

Knew Who Is

I was just wondering if you knew who is running the [xyz].com site.


Thanks,

I don't know how to knew something.

 

You might consider re-writing your question in SVO-p.

 

To find out who is running a site, you might try emailing that site.

Tue, 9 Dec 2003


Rejection

Ed Says: You might take your feelings about rejection and avoiding rejection, as an entry point, into TTP.

Today I had to close a trade at breakeven. It was not working well as "I expected it to" and the stock started to show weakness.

In spite of being out at breakeven I have the same feelings of rejection. Situations like these often remind me of "losses" and "failures" in other areas of life and issues about rejection, lack of recognition/support or love.

No wonder I might be bringing this pattern into FAQ and writing to get some encouragement or, say, a friendly word from Ed (like from some authority figure). I know it seems rather childish but it is exactly how I feel about it.

You seem skillful in enrolling people as your enablers ... to help you run away from your feelings  ... to drift off into commentary, theory and analysis.

 

You might take your run-off drama to a Tribe meeting.  Good receivers can celebrate your feelings with you, encourage you to experience them, and find their positive intentions.

 

 

 

Taking Feelings of Rejection

to the Tribe, is TTP.

 

Getting the Tribe to Reject You

is just more Drama

 

Clip: http://esart.com/paintings/

mkpgnew.php?work_number=414

Tue, 9 Dec 2003


Commitment to Trend-Trading

Dear Mr. Seykota,

I recently ran into an article Do you buy breakouts? Think Again

http://biz.yahoo.com/tm/

031208/11017_4.html

 

The article points out that since 1993 where S&P rose over 145%, but a strategy that buys 10-day breakout with trailing stop at its 10-day average actually loses substantial money.

While I cannot justify the accuracy on the study, and certainly the study doesn't include any position-sizing methodologies, it has been wandering in my mind, as I've told you a week ago, that I still have some lingering doubts to completely accept trend-following.

 

I find it to be the root of my difficulties to stay committed, because I still lack the faith. As the Goethe's poem goes, "Until one is committed, there is hesitancy, the chance to draw back, always ineffectiveness ..."

In the FAQ on March 28, you said, "In the markets, just about everything works sometimes, and hardly anything works all the time." As I accept this statement, I keep thinking whether I can completely embrace trend-following as part of life, knowing that hardly ANYTHING (guess that includes trend-following) works all the time.

You have an interesting claim that all systems that make money trade trends
(FAQ, Dec 1), and that a definition of trend is that if you buy at A and sell at B, B must be greater than A for a profit. This is quite different from what most technical analysis books have.

 

Looking at some arbitrageurs and market-makers, they seem to make money using a system that is slight deviating than what one usually thinks of as "trade trends", by trading multiple instruments (eg. buy S&P e-mini @ 1060.25 and simultaneously sell S&P futures contract @ 1060.3) or leveraging the ability to buy at the bid and sell at the ask, while the market quote stays at a fixed level.

Now as I'm writing, it becomes increasingly clear to me that I am not trying to disprove your definition of trends or your claims that ALL systems that make money trade trends, but just that I am spending all these efforts trying to disprove trend-following so as to embrace it, so that I can commit myself without any reservation or hesitancy.

 

Still, there is this doubt that just won't go away, hopefully some TTP will help. (The snow storm causes our recent tribe meeting to cancel)

Thanks.

The article seems to show that a long-term trend system (that stays long the entire move - and does not buy a lot of breakouts) outperforms a short-term trend system that gets in and out on a 10-day rule.

 

It does not seem to speak against trend following.

 

Yes. You might take your feelings of doubt into TTP.

 

 

Tue, 9 Dec 2003


Short Signal ?

re: Sun, 7 Dec 2003 Some of your Systems


Sometimes systems offer up signals to go long, other times signals to go short.

 

However, In my own humble and limited experience, systems don't tend to give short signals on themselves.

If a systems trader sells his system short without his system giving a short signal on itself, then he seems to be making a discretionary trade.

The borderline between discretionary trading and system trading tends to blur as Fred and CM entwine.

 

 

 

Entwining

 

Promotes Synthesis

 

Clip: http://www.econ.nyu.edu/user/

baumolw/entwine.jpg

Mon, 8 Dec 2003


Lennon and TTP

Ed,

I am driving down the highway on a Sunday afternoon with my wife and two young children. The radio is tuned to a repeat of "Prairie Home Companion" on NPR and the host and guests are singing old Lennon songs.

The group start to sing "Imagine" and at the same time I am listening because I am not rationally tinkering. It dawns on me. Lennon operates in the NOW. The following are the lyrics.

Imagine

Imagine there's no heaven,
It's easy if you try,
No hell below us,
Above us only sky,
Imagine all the people
living for today ...

Imagine there's no countries,
It isn't hard to do,
Nothing to kill or die for,
No religion too,
Imagine all the people
living life in peace ...

Imagine no possessions,
I wonder if you can,
No need for greed or hunger,
A brotherhood of man,
Imagine all the people
Sharing all the world ...
 
You may say I'm a dreamer,
but I'm not the only one,
I hope some day you'll join us,
And the world will live as one.

by: John Lennon
© Bag productions inc.

Why and Because imply causality and invoke fundamentalist thinking.

 

 

 

John Lennon

 

All You Need is SVO-p

 

 

http://www.newgenevacenter.org/

portrait/lennon.jpg

 

Mon, 8 Dec 2003

 

Introduction


Dear Ed,

I am a futures trader in Columbus, Ohio. I have been doing it for 3.5 years. I have great research and trading skills for trading the SP futures market.

 

My philosophy is to use the ND, DJ, and RL to trade the SP on a 15-min chart. All markets are either going together, in which case is my breakout.

 

Or there is an inconsistency in the 4 markets, in which case a reversal occurs. I have been trading alone for the last 2.5 years and even though I feel incredible about my research, I would very much like to work with a trader more seasoned than myself.

 

I am committed to my craft and sure I could learn something from you. I learned the basics from [XXX] who was [YYY's] assistant. I developed my own trading strategy.

 

I know that you are a trend follower influenced by Donchian, and that you have mentored other traders.

 

I would very much like to talk to you, even if for a few minutes, to gain some further conviction concerning my trading strategy.

 

If nothing else, I could forward you my trade sheet and research for further criticism. I hope all is well and Happy Holidays. I hope to talk with you soon.

Best wishes,

FAQ addresses questions of general interest to the trading community, by traders who wish to become examples and support each other. 

 

For private consulting, see the link on the Ground Rules page.

 

 

Mon, 8 Dec 2003

 

NLP


I am learning about NLP and wanted to ask you how similar is the NLP methodology compared to the Trading Tribe methodology.

Thanks

You might be the best source of information on how similar they are for you.

 

 

Sun, 7 Dec 2003


Risk Tolerance

Ed,

I've been scaling up at fixed dollar increments in the account.

 

Currently this is a linear relationship, but I've been realizing a desire to decrease risk over time in an asymptotic fashion if growth continues, which is a common preference. If I had 5 million dollars, I wouldn't trade aggressive margin, I would probably hold mostly treasury bonds. How did you define this utility curve in the early stages of your account when you wanted to go full steam ahead, but also felt there was more at stake?

Last week my scaling system gave me the green light to increase size, and it is so far feeling a little hot, especially approaching the holidays, and just above the scaling boundary. On the other hand, there seems to be a pickup in volatility and a likely equity curve run-up in progress. If you were trading relatively small lots would you adjust your position size based on these conflicting risks and opportunities?

I have been considering full size shorts and 2/3 size longs into new years. another alternative is to increase my artificial margin requirement, systematically bumping back down to the smaller size. another alternative is to skip holiday longs completely. Final alternative is to wing it and go on my feeling at the time of the trade.

 

It's a difficult slope to determine. As a systematic trader, do you ever adjust size for qualitative reasons like possible terrorism during the holiday season? I feel like I will enjoy Christmas and new years more if I am not long, but I'm also strict with myself about falling behind the system equity curve, and feel like I've seen high event risk positions pay off large in the past.

There seems to be irony in the idea that you get to the end point faster by trading less aggressive margin, but I observe this again and again in the guys who've lasted.

You can simulate various risk management strategies to find the optimal for you.

 

You might also take your feelings, hunches and desires, as entry points, into TTP, to dissolve dramas you may be running in this area.

 

 

Red and Green

Hot and Cold

Long and Short

On and Off

 

Or ... just ride the trend.

 

 

Clip: http://www.montana.edu/

wwwufs/graphics/tour%20green%20light.gif

 

Sun, 7 Dec 2003

 

TTP Peels Away the Layers

Hi Ed,

As a result of doing TTP I have seen quite a few positive benefits in my trading, I recently looked at my monthly statements, since I started doing TTP there has been a steady improvement in my trading. Although an AHA eluded me all this time, it finally happened couple of weeks ago.

The episodes of self sabotage have reduced, however they still show up almost on a weekly basis.

 

I have developed some very good trading systems, they have been thoroughly back tested. A friend with whom I shared this mechanical system has been doing quite well - while in my case, due to self sabotage,  I have not done as well.

The system is fully automated, the computer monitors and executes the trades unattended, all I have to do is to turn on the computer and just let it run.

 

Unfortunately I still find a way to override the trades, I find it very hard to give up control to let a mechanical system run my trading.

Would you have any thoughts as to what Fred may be trying to do for me?

I am not new to trading, have been trading for over 15 years and its always the same pattern of not following a mechanical system. The issues that come up are avoiding losses, a quest to be perfect, have control. Control seems to be a very important issue.

I don't know if you saw the movie Mystic River, I can identify with Tim Robbins character Dave. In my case I have explored my past quite a bit via traditional therapy of all kinds.

Robbins plays the deeply troubled Dave. ďDave is one of these guys who finds a way to survive and exist despite a past filled with horrific events,Ē the actor muses. ďHeís internalized his painful experience and not talked about it or dealt with it, so it has festered and festered for years. Itís not particularly fun, going to that dark place for long periods of time."

You seem to be asking for an analysis of Fred's motives. 

 

TTP does not attempt to analyze Fred, motives or anything else for that matter. 

 

TTP intends to connect Fred with CM so they can communicate experience.

 

You might take your feelings of wanting to stay in control, of not wanting to "let go" into the process as a starting point.

 

 

 

Letting Go

 

Sometime Initiates Soaring

 

Clip: http://tea.rice.edu/bergholz/

pics/html/page6.html

 

Sun, 7 Dec 2003

 

Some of your Systems



Hi Ed,

I am forwarding some information to you about adding some of your systems and money management strategies in to [xyz software]. In fact, [xyz] said that if they find systems helpful they will help market them to their customer base.

I mentioned to XXX, CEO of [xyz], that I sure wish we could get Ed Seykota to contribute a few of his systems in to [xyz]. See his reply back to me-

Dear YYY:

Excellent! If you could, please let Ed Seykota know that I will contact him [soon]

 

I will get him a free SDK license as soon as we have updated the SDK for 2004. However, if his systems have general appeal we might program them for him. We are currently promoting one other system provider and paying him a royalty, and the system provider is promoting [xyz] to his customers. We would do the same for Ed Seykota, provided everything else lines up.

-- XXX

If you are interested in working with [xyz] to provide some of your systems and key money management strategies, please let me know and I will let XXX know of your interest.


If you have a programmer already they could do the programming. Also, XXX has offered to program your strategies for you and pay a royalty for any sells of your systems, which I believe will be quite popular.

Thanks,

Trading algorithms are a part of trading, other important parts are risk management, attitude and knowing how to deal with feelings that arise during trading.

 

You might like to elaborate on how XXX intends to provide risk management, attitudinal and emotional support so traders are able to stay on task.

 

I wonder if XXX keeps track of how well his customers do once they buy his product, and if he publishes that data.

 

 

Buying a System

 

Might be different from being able

to get it to fly.

 

Clip: http://www.westcoraviation.com/g4ext.jpg

Sun, 7 Dec

 

Romantic Dramas

I read this Ugly post on FAQ and I feel like sharing my issue.

Over the past few years I have been feeling attracted to women who have no interest in me and so realizing my intention of being overlooked for someone else or getting rejection.

 

I also find that a lot of women, whom I absolutely have no interest for, feel quite attracted to me, and so reinforcing my self-perception (judgment) of being emotionally screwed.

Note: I have been blessed with a beautiful face and body.

You might take your feelings about rejection and avoiding rejection, as an entry point, into TTP.

Sun, 7 Dec


On Task


Ed Said: You are pretty good at describing it, analyzing it and naming it.

Now how about experiencing it.

Keeping you on task experiencing your feelings (instead of drifting off into analytics) is one of the functions of the Tribe.


In addition to sharing the feeling I have been experimenting with music or images that somehow resonate with this feeling of guilt, so as to better "sense" it. I had to draw back from it after a while as I dislike it very much for personifying it as the Devil itself. I acknowledge that wanting to experience the feeling (and trying to force it) is not the same as doing it naturally, but, nevertheless, linking wealth to Devil has not necessarily to be a true fundamental construction.

Ultimately, I proceed with the very feeling of wanting to experience it and I am feeling better now. Still on task, though.

A good receiver can help you stay on task.

Sat, 06 Dec 2003

 

Trading on the NASDAQ

Hi,

On Friday, trading in shares of Corinthian Colleges ( COCO ) were halted when the price fluctuated from $57.50 to a low of $39.25. This resulted in the halting of trading on the stock.

 

Trading was resumed, without any indication of an underlying problem. Over an hour later, the NASDAQ decided that the trades were cancelled, so those who had gone long had their buy orders cancelled and were now considered to be short. This has resulted in the accumulation of significant losses for many small investors.

 

One would think that trades would be completely rolled back, rather than a partial or incomplete rollback of trades (the elimination of a buy order doesn't constitute the elimination of a trade if one side of the trade is cancelled ). I'd like to hear your insights into this matter.

Best Regards,

FAQ does not offer instrument specific trading advice, recommend trades or attempt to predict anything. See Ground Rules.

 

As part of your risk management, you might consider keeping your position size appropriate to volatility.

 

The trade does not seem consistent with Trend Trading - You might take your urge to buy on dips into TTP as an entry point.

 

I do not follow how canceling a buy order makes you short. You might consider re-writing your description in SVO-p to clarify it.

 

 

Hot Coco

Prices Through Friday

 

No trades showing below 51.

 

Fri, 5 Dec 2003

 

Fractals and Trading

Hi!

I am wondering why you have information about fractals on your website?

 

Is there something to learn about trading through the study of fractals? And if so, what?

Best regards

The "information" about fractals is a poem, about borderlines and the search for them.

 

Note: "Why" questions are inherently ambiguous. For example:

 

bullet

why you instead of someone else

bullet

why information instead of directions

bullet

why fractals instead of factoids

bullet

why your website instead of another one

bullet

why website instead of book

 

From intention = result, the poem appears on the site "because" it is your intention to see it there.

 

You might take your feelings about asking "why" questions into TTP as an entry point.

 

 

 

The Borderline

Between Bullish and Bearish

 

can be as thin as an aha.

Fri, 05 Dec 2003

 

Next Workshop


Dear Ed,

Could you please tell me the best way to stay informed as to the date of your next TTP workshop?

Thanks,

One way is to watch FAQ.

Fri, 5 Dec 2003


Ugly

Ed,

My whole life I have have been blessed with an ugly face and have a hard time getting women to like me romantically.

 

I was teased my whole life in grade school. In college I worked out in the gym constantly which, when I had a good body woman were attracted to me and it evened out my unattractive face better. But now that I am getting older, have gained weight, my hair is balding, and my nice body is gone I am ugly again. I find it very hard for woman to like me romantically.

I am writing this because today a woman who was a friend of mine (I thought) really hurt me when she basically implied that I was ugly and balding in a hurtful way.

I went home and processed these thoughts by going home and looking at my face in the mirror while I was crying my eyes out. My conscious mind is no longer in denial. And I am going back into the gym to try to improve on myself even though I know i can't change my face.

I would be honored if you could offer me a little insight.

Thanks,

Doubling up on your efforts in the gym is just more "solving" - it just changes the details of the drama.

 

You might also take your feelings about your drama into TTP.  When you locate them, experience them and find their positive intentions, you may find your drama dissolving.

 

Perhaps, you are so intent on running your game, that you are overlooking  women who might be romantically attracted to your vulnerability, your willingness to share your feelings about your appearance.

 

 

 

Just a Reflection

 

until we learn to judge it.

 

Clip: http://uweb.superlink.net/

~lwilkens/graphics/mirror.jpg

Fri, 5 Dec 2003


Guilt

Ed,

In the process of making friends with feelings, there is a particular one I have difficulties to. It's guilt.

I have a sense of guilt when asserting myself. I also have feelings of guilt about success and, yes, about wealth. I even admire people like you, for "being able" to "cope well" with success and, say, charge a fair fee for your professional services or just "welcome money" when it comes in.

I have been trying to experience with some of these feelings of guilt and I end up with more guilt about doing that.

Regards,

You are pretty good at  describing it, analyzing it and naming it. 

 

Now how about experiencing it.

 

Keeping you on task experiencing your feelings (instead of drifting off into analytics) is one of the functions of the Tribe.

 

 

Roller Coaster

 

Analysis differs from experiencing.

 

Same goes for the markets.

 

 

Clip: http://www.travelspots.com/

images/roller-coaster.jpg

Fri, 5 Dec 2003


Intention for Practitioner's License

Ed,

My intention regarding a Practitioner's License is to help people become better parents.

 

Since my involvement with TTP, I have seen great changes in my parenting and relationships. I would like to help others with what I have learned and share in their progress and growth. I am interested in helping others on a part-time basis and charging by the hour or session. Maybe I would just charge a group for the time it takes to help them become self-sufficient. I am not certain. In our area, we have a lot of weekly parenting magazines, community centers, parenting classes, etc., that could be used to introduce people to the TTP process.


Goal (snapshot):

I am with a small group of parents. We are all checking-in. The feedback is very positive. The parents are describing the ways their relationships with their children are growing and improving. The parents are describing how their children are expressing their emotions and learning to handle challenging situations. I feel a deep sense of satisfaction. I am happy for them and their children.


Feelings between me and my snapshot:

Uncertainty - Not knowing what is required for a Practitioner's License.

Self doubt - Not sure if I am proficient in TTP. Do not feel "clear" enough to avoid invalidating other's feelings.

Besides participating in a tribe, and learning all I can about TTP, I am not sure what else I can do now to make the snapshot real. Any information you can provide me will be very helpful.

Regards,

Thank you for your commitment to helping children and for your willingness to deal with your own issues.

 

Anyone may assemble and conduct meetings to discuss, teach and use anything on the Trading Tribe Site - as long as it is (1) not-for-profit, (2) absolutely free to participants, (3) at the risk of the presenters and participants.  See FAQ Ground Rules.

 

If you wish to use the resources on this site, such as the TT logo, the name, Trading Tribe, and other terms of art, such as Fred, CM, and Hardball Process for profit, you may apply for a practitioner license.

 

The license certifies you have a good grasp of the theory and practice of TTP and that you are good at using them.

 

To proceed toward a license, send a case study, from your work, for publication of FAQ, demonstrating your understanding of the work, and  illustrating how you use it.

 

 

Trading Tribe FAQ

 

Sometimes it seems to write itself.

Thu, 4 Dec 2003

 

1st LA tribe meeting

Wow!

I mean ... Hi Ed.

I took the hot seat last night and followed a bunch of feelings until they let go. I had many different things happen to me in the hot seat and after I left the tribe meeting. At this time I can't verbalize anything about my experience last night.

Well, I can say two things:


1. WOW!
2. Thank you ... from my heart to yours.

Best of everything to you and yours,

Yes. 

 

Sounds like the LA tribe is working the process.

 

 

 

 

The Seat of the Action

 

Clip:

www.edsstudio.tripod.com/

studio/hotseat1.jpg

Thu, 4 Dec 2003

 

Permission to Trade

 

I need someone to talk to in Madison Wi. that has been trading electronically in futures. I don't understand your reply on
precisions .

 

My personal system is not precise. I use a current price chart, watch price action, oi / volume increase or decrease , 14-20 day MA and a truthful or a lying fundamental.

 

What I'm asking you specifically is will you let me trade my 10,000 either on paper or for real with real entry and exit numbers.

 

Can real exit and real entry numbers exist if we are only trading paper?

(1) I have no evidence that I have authorization to either let you or not let you trade.

 

(2) Yes, numbers can exist.

 

If you want answers that make sense, consider asking questions that make sense.  You might show your questions to a few friends and see if they understand them.

 

Also, you might take your feelings about people not understanding you / you not understanding them into TTP.

 

 

 

Gibberish

 

communicates a lot

about how you feel about

clear communication.

 

Clip: http://hometown.aol.com/mlbmiller/

images/homepage%20gibberish.jpg

Thu, 4 Dec 2003

 

Happy Thanksgiving

Dear Ed,

Please accept this belated Thanksgiving greeting to you, Ziz and Aziza. Living so far away, one tends to lose track of important events in other countries.

I wish acknowledge the fact that you are a major motivational factor in my growth as a person - by setting an example as a compassionate and wonderful parent, a great fund manager, a poet and scientist.

Thank you for your generosity, and for showing us all that the pursuit of excellence in everything we choose to do or think can make us more, than we can ever
imagine.

Sincerely,

I seem to have lucked-out and got kids who know how to bring up parents. 

Thu, 4 Dec 2003


Intentional Provocation:

some avoid it, others pay for it.


This classic parable below, which I restate in SVO-p, seems to be similar to the 'Intentional Provocation' method that the tribe may sometimes employ.

A new student is commanded by his master that for three years he gives money to everyone who insults him. When this period of trial is over, the master says, 'Now you can go to the great city and obtain wisdom.' Approaching the gates of the city, the student meets a certain wise man sitting at the city gate insulting everyone who comes and goes. He insults the student also, who immediately bursts out laughing. 'Why do you laugh when I insult you?' says the wise man. 'Because,' says the student, 'for years I've been paying for this kind of thing, and now you give it to me for free!' 'Enter the city,' says the wise man. 'It is all yours.'

Nice story.

 

Here is some SVO-p provocation for you:

 

The Master commands ...

I usually pay ...

 

 

 

 

The Gift

 

is in the present

 

 

Clip: http://www-personal.engin.umich.edu/

~ajdrake/toddler/present.gif

Thu, 4 Dec 2003


Positives from London

Dear Ed,

The London tribe had its 4th meeting last night and I am happy to report that things are going well.

 

The changes I've noticed in my behaviours since attending tribe meetings include making more time for my family, being more courteous to my loved ones, taking less risk while driving and noticing things of beauty that have always been around me.

 

With regards to trading I trade less frequently, work harder at finding the right opportunities, keep positions for longer and only add to a position when they show me a profit.

 

These factors have contributed to far superior trading results then previously, for that I am eternally grateful to you, my tribe and the Trading Tribe process, thank you.


When I first showed an interest in the TT process my sole motivation was to improve my trading results, I didn't expect any other positives and didn't think my life needed any.

 

The whole process is having a beautiful effect on other areas of my life that I now realize are far more important than trading results.

Warm regards,

Yes.

Wed, 3 Dec 2003

 

FAQ Inspires Wife to TTP

Hi Ed !

Latest FAQs give me much to consider ! Thank you. The small formula ...


intention = results



is the most powerful no-excuses goal/behavior aligning koan I've ever experienced. Focusing it on my life feels like an electric current blowing out past excuses, future doubts. It is the antidote to psychotherapy which of course employs the formula ...

 

results = everybody else's fault

 

to burrow further into the bundles of convoluted thought/emotion we label the past.



* * *



Yesterday evening I read the December 1 post on dissolving backaches to my wife. Consequently she asks to do the TT process. I describe it, and she says maybe she would have time tomorrow.

In a pleasant, calm voice I mention that we can't possibly do it tomorrow, because tomorrow doesn't exist. All we can do is 'do it now' or 'not do it now' and either one is fine. We can also hide the 'not do it now' intention behind the cloud called 'tomorrow' just for fun.

She likes that clarity, and wants to do it now. She says she wants to put on her nightie first, though. I say good, at the Reno workshop we discovered it works much better when wearing nighties. She laughs at the thought of us all sitting around in nighties, and we begin the process feeling feelings.

We go through several layers, such as back pain which appears as black boxes, which experienced, dissolve along with the pain. Feelings of sadness register in the center of the chest. Feelings in the stomach turn into black worms and disappear. Movement. Noise. All the usual stuff ! She asks to do the process again today.

Things are moving. Tube ends open.

rgds,

Yes.

 

 

 

 

Latest Attire for TTP

 

Clip: http://www.sulis.co.uk/pics/ch01li.jpg

 

Wed, 3 Dec 2003

 

Why


Dear Mr. Seykota,

I have just started trading but I am really inexperienced and don't know anyone or any source of reliable information, for example systematic trading or methodology etc. Could you give me a tip of where to begin?

Do you think it is a zero sum game based on strong equations? Why does Soros state that "It's not a zero-sum game, It's very important to realize. No math.

You might consider joining a Tribe in your area.

 

TTP does not respond to "why" questions as they are fundamentally ambiguous, even meaningless. 

 

Another approach is: try sharing your feelings around what you want to know.

 

 

 

The Wise Guys - Amusing

 

The Whys Guys - Confusing

 

Clip: http://www.umsl.edu/services/

cis/cishome/Wiseguys.jpg.jpg

Wed, 3 Dec 2003

 

Friends

Dear Ed,

I am just curious, are you still friends with Michael Marcus or not?

 

I admire both of you guys. Anyway thanx for the previous advice.

You might take your just curiosity about the personal lives of others, as an entry point, to a Tribe meeting.

Wed, 3 Dec 2003


Student


Mr. Seykota,

I am a Junior at the Cox School of Business at Southern Methodist University in Dallas, Texas. The purpose of my e-mail is guidance, and your remarks in Jack Schwager's Market Wizards on how everyone gets what they want out of the market really hit home with me.

 

I don't care to make billions of dollars in the markets, but I do care about having success. What I want out of life and the markets is understanding.

 

I know the best trader's are never 100% certain about a trade, and I feel that one can only hope to maximize what they have in this world. I guess I am just struggling with how to know when I have maximized my utility. I don't have any money of my own to trade with, but I have read every book by Jack Schwager, and numerous other books on trading and psychology.

I was wondering if you could suggest any books on trading or on life in general? I know I am young (20), but I feel like trading is what I was meant to do. I would appreciate any guidance, and I wish you continued success in your life.

Thank you very much,

You might try using SVO-p since there is no way to "was meant to do" things in the now.

 

You might take your desire to understand things, as an entry point, into TTP.

Thu, 4 Dec 2003 08:41:52 +1100

Start Community

Hi TT

I would like more details on starting a community for traders

See Tribe Directory, above.

Wed, 3 Dec 2003

 

NLP and Idioms



Dear Ed,


Some NLP authors state that experience is stored in the subconscious (Fred) in pre-verbal "files". They say that when we communicate through language there's a process of deletion / distortion / generalization of many aspects of our experience in the flow of experiences from Fred to CM.

 

Only when the experience is already in CM, it can be stored in language format so we can communicate with the world outside. This is why many times we say things that are not comprehended by others (the process deletes, distorts and generalizes aspects that our mind judges unnecessary, but are completely necessary for others, who do not share the same experiences that we have, understand). Even this explanation is subject to deletion / distortion / generalization and it is a reflex of what I know but not necessarily what others will understand.

Knowing this I observed a very interesting pattern regarding people who speaks more than one language.

 

I have studied in international (bilingual) schools all of my life. In those schools we had to study math, sciences, social studies ... in 2 languages (English and Portuguese).

 

Here where the pattern begins: I have always felt that the learning process in English was easier comparing to the learning process in Portuguese even though Portuguese is my first language. I did not know exactly why but it seemed English provided a more direct approach to knowledge than Portuguese, which I used to define as a more "bureaucratic" language (the same thing applies to Spanish and Italian, which are "cousin languages").

I'm 25 years old now and while reading and studying NLP I decided to test that old theory by talking to my old schoolmates. Surprisingly I was right (even though it's not a big data base, but it definitely shows a pattern): I talked to 22 old friends from 2 international schools. 18 of them shared the same opinion (and only 6 of these 18 friends have English as their first idiom); only 4 of them disagrees and thinks Portuguese is an easier language to learn things - now, here's also an interesting observation: 3 of those 4 colleagues had their first contact with English after they were 13 years old and 1 had her first contact with English when she was 9).

Now, I have also met children that came from non-English speaking countries when they were 3-4 years old. Those children spoke fluently English (school's idiom), Portuguese (school's and country's idiom) and their home idiom (Arab, German or Dutch) without messing up any of the 3 languages. This simply didn't happen. The child spoke all of the 3 languages with absolutely no problem, because he/she had learned those languages too early in life. We were used to it because a lot of friends were in that situation, but grown ups in that time (and also now) always were surprised with this fact.

So:

1. It seems that there are languages that provide a more direct approach to knowledge than others; therefore, learning may be easier in those languages.


2. People can easily learn 3-4 languages and speak them fluently as long as they learn the idioms early in life. Fred will simply separate the languages and will not cause difficulties. In the other hand, adults, in average, find it hard to learn a second language - they may learn a second language but it takes much more time comparing to children; the third language is a tough one to learn. the fourth ... that one requires a lot more of effort (unless it's a language of the same base (Latin, Anglo-Saxon, Arab etc) of the ones the person already speaks).

This is the first indication I have that NLP authors are writing about Fred.

 

If you wish to cite a reference, you might do so by name.

 

TTP seems to compliment NLP.

 

Many linguistic processes, like how to move your lips and tongue, and how to parse sound waves back into words and meaning, occur "without thinking," under Fred's control.

 

I find more difference between SVO-p non-SVO-p people, and between people who see that intentions = results and those who don't - than between people of different languages.

 

 

People Might Differ

 

less by native tongue

and more by how they use it.

 

Clip: http://www.britannica.com/bcom/

images/world/nations-world-map.jpg

 

Wed, 3 Dec 2003

 

Where Is Michael Marcus

 

Dear Mr. Seykota:

My boss [XXX]  of [YYY] fund, Inc. read a short article on Michael Marcus ... we are interested in finding out more about Mr. Marcus and we were wondering if you would be able to tell us how to get in touch with him. I tried directory information in [City] but he is non-published.

We would appreciate any information that you might have.


Thank you for your assistance regarding our request.

Very truly yours,

FAQ respects private property, including private information.  If Mike happens to read this and writes in, I can send him your address.

 

 

Private Property

 

Under-Standing Capitalism

and Freedom

 

Clip: http://www.castsign.on.ca/

Images/Private%20Property.jpg

Tue, 02 Dec 2003

Percentage of Days

Under a Certain Draw Down Percentage as a Risk Metric


How do you think of using percentage of days under a certain draw down percentage as a risk management metric?

For example let's say this percentage is 30% and then when evaluating a system we count the days where capital is less than 0.7 x max capital. Then dividing it into total number of days we get the metric.

Then we can say for example : "I don't want to spend more than 5% of my time below 30% capital draw down" and then select the proper bet size that gives us this result.

The logic is: max drawdown is a point whereas testing period is a period. and, comparing a period with another period makes more sense.

Can you see any problems with this approach? Do you think it might be a good
idea?

Thanks and regards.

Part of back-testing is to determine position sizing and risk management strategies that fit within your drawdown tolerance envelope.

 

If you allow deterioration of your equity to continue after you penetrate your envelope, you may find you still have some "uncle" point that represents your absolute tolerance.

 

You might check your feelings about wanting to give a market a little more room, after it hits your stop.

 

 

 

Pulling the Stop

 

May Reduce it's Effectiveness

 

Clip: http://www.crh.noaa.gov/fsd/

images/jacksonne/stopsign_small.jpg

Tue, 2 Dec 2003

 

Creeping Up On The "Real" Thing


Ed Says:


Some people like to approach the real thing slowly.

I encourage you to go at whatever pace you wish. As you proceed, slowly creeping up on it, you might take the feelings of wanting to avoid in-person TTP into your video-TTP process.


Yes, incontrovertible trend follower!  There are a lot of real things I like to approach slowly ... very ... very ... slowly ... until I finally realize I actually do not want to do it!

When you finally do realize you don't want to do it, it's exactly now. 

 

 

Procrastination

 

can have a positive intention

so be careful not to put off

procrastinating too long.

 

Clip: http://seekers.100megs6.com/

3Minutes/20452_wallpaper280%20%

20%20%20TIME%20WATCHES.jpg

Tue, 2 Dec 2003

 

More on Living in the Present


Dear Mr. Seykota,

As I grow more aware of living in the present, I come across this site


http://www.turtletrader.com/

seykota-student.html

 

with the heading: "More Lessons Seykota Would Preach?" Among those are some great quotes from Reminiscences of a Stock Operator, which I totally feel in sync with except this one:

The stock market moves ahead of world events. The stock market is not operating in the present, reflecting the present; it is operating on what is yet to be, the future.

 

The market often moves contrary to apparent common sense and world events, like it had a mind of its own, designed to fool the most people, most of the time. Eventually the truth of why it moved as it did will emerge.

Is this (ie. stock market operating in the future) a lesson you would preach? Why or why not? I think the market has its own discounting effect on future events, but if the statement is correct, does it mean that we (who are living in the present), are actually playing a game that is operating in the future?

BTW, as I was putting down my thoughts in my journal, I just realized the magnitude of impact you have had on me. Other than my immediate family members, perhaps you have made the biggest changes in how I see things, despite you never tell what one "should" do, despite we never meet, despite to me you used to be some distant super trader figure to whom I never thought I would have a chance to communicate with.

 

It is amazing how the internet makes the unimaginable possible.

 

Thank you wholeheartedly for the FAQ.

ciao,

The markets tend to discount (now) many things that are not (now) happening.  The market also tends to discount many things that never happen (now).

 

Stocks do not trade in the future or in the past, they trade now.

 

Even looking at historical futures prices occurs now.

 

 

 

March 2004 Historical Futures

 

A record (now) of the ever evolving

moment of now.

 

As you look at this chart,

notice when you are doing so.

 

 

 

The Nature of an AHA

 

Clip: http://www.the-private-eye.com/

images/index2.gif

Tue, 2 Dec 2003


Chinese web link missing? +

Divorce / Kid Problem

Hi Ed,

I can't find the Chinese link to the TTP page on the site - please update the links page for the translated version.

A friend of mine divorced several months ago. She says that she and her son are so happy to not live with her father, and that things are much better.

 

I felt really bad when I heard that (I don't know why), so I asked her to ask her son how he feels about daddy not being around anymore. I told her to listen to what her son says and how he feels, and no judging. This is the email I received this morning:

"I have asked my son how does he feel. He said he feel sad and heartbroken. I asked again to make sure what he answered he said that again.

 

I don't know what I can say when I heard the answer It is not fair let him stand these." 

 

Do you have any suggestions on what she and her son can do?

 

Locating physical feelings is important, but is there any difference in practicing TTP if he only two years old?

Thanks,

You can find a link to the Chinese translation near the top of the TTP Page.

 

One thing you might do for her is to work on your own feelings about divorce and single-parent families, perhaps by taking them into TTP.

 

When you clear your own issues you might become a clear receiver for her, to help her clarify her issues, in her own way.  What she can do in turn, is to be a receiver for her son.

 

TTP spreads by receiving; pushing TTP on others, telling them they "should" try it, is not part of TTP. 

 

If they notice something about you and ask, then you can tell about your own experience.

 

You can sometimes say a lot, just by listening.

 

 

You Can Use Your Ear

 

to inform people.

 

Clip: http://www.meniett.com/

images/ear.jpg

Tue, 2 Dec 2003


Seeking advice

(or want others to tell me)


As I am reading the old FAQ, this one (see bottom) comes across very interesting and I like it. I start to understand where the doctor's coming from and appreciate his answers, but not yet fully endorsing the approach.

Perhaps I still have feelings that want to be told (passive tense, hiding the person who is telling me). On second thought, what I really want is to have a professional / expert giving me advice, based on his experience in
the respective field.

Therefore when I go see a doctor, I expect him to tell me, from his expertise and his analysis on my health problems, what are some food that may help, or some exercise I can do. True, the "best" food/exercise differs from each person, but based on his knowledge on my health problems and experience, I think there are "good" food/exercises that he can recommend.

 

For example, I have thyroid problem, and my doctor said it'd be best for me to avoid seafood. It is better for him to let me know than me experimenting with all kinds of food and then realize that seafood is bad for my health after it kills me.

In a way, that's what I am doing now, seeking your thoughts. I think that there is always something that I can learn to enrich myself through talking to people and learning from their experience. Perhaps I may also respect that other people may have different way of sharing their experience, or even not want to share at all. I learn from you (through FAQ) that one way to draw people closer, is to respect their desire to be distant.

It's funny - the "answer" gradually forms as I am writing it.

I guess I may take this "seek expert's advice" feeling to TTP. Thanks.



-----

(Doctor's Parable: FAQ 3/21/03)

"Doc, will I be healthy?"

"Health is not a guaranteed thing in life. If you have a positive mental attitude and good personal habits, you can greatly increase the odds though. You are the best person to ask whether you really want to be healthy and have the determination for it."

"Doc, what is the best exercise?"

"It is different for different persons. The best exercise for you is the one that you love to do and have the persistence to follow through."

"I think running is good. Should I run 5 miles or 20 miles per day? Should I stop running if it rains one inch or two inches in the morning?"

"That depends on your stamina inside and the weather outside. You might try to experiment for a while and decide which is best for you."

Yes.

 

Taking your feelings about wanting advice into TTP can help you clarify your relationship to information resources.

 

 

 

In the Process of Writing a Question

 

people sometimes answer it.

 

Clip: http://www.people.virginia.edu/

~pm9k/libsci/writing.gif

 

 

 

 

 

 

 

Mon, 1 Dec 2003


Evolution of Result - or Noise

Ed Says: "Deny responsibility for your experience and a delta between intentions and results may appear."

I'm more interested in understanding ... how noise arises at the points of conception and action within the evolutionary chain of experience - from intention-to-result.

When you notice all things happen now, and when you take responsibility for your experience, you notice that even "noise" results from your intention. 

 

At that point you can clarify your intention and remove the noise.

 

The entire length of the chain of events exists in the ever evolving moment of now - and at all points of now, you may chose to see your result equals your intention.

 

Alternatively, you may choose to avoid responsibility, especially for the noise, and then try to find exogenous "causes."

 

 

Noise

 

TTP converts perception of it

from an exogenous problem

to part of the intention.

 

Clip: http://www.bbc.co.uk/health/

features/tinnitus.shtml

Mon, 1 Dec 2003


Analytics

e-TTP Inter Tribe Communication


You seem to like to analyze your situation and find "causes."

Yes. I like to analyze my situation and find "causes". I have extended this to the TTP. Typically, I analyze myself and look for feelings which are potential causes of my problems. Then I am using the TTP as a tool to "solve" my problems and "fix" myself.

Analysis leads to solving and fixing. TTP leads to dis-solving and noticing things already work right.

 

Incontrovertible solvers tend to use TTP as an analytical tool - until they happen to experience their own feelings of wanting to solve things.

 

 

 

Solving

 

adds energy and mass

to the problem

 

 

 

Dis-solving

 

turns it into an AHA

and makes it disappear

 

 

Clips:

http://mostlymurder.com/barbat.htm

http://www.concept-rx.co.il/Products.html

Mon, 1 Dec 2003


e-TTP Meeting - Now by Web Cam

more Inter-Tribe Communication


We might also try videoconferencing. In order to do that, you'll need a web cam and audio setup. Messenger has a feature that enables us to start a videoconferencing call for a given contact on Microsoft NetMeeting. Although Messenger also has the web cam feature, it seems that its latest version (6.1) has a bug and is not working with the web cam. NetMeeting, on the other hand, is a very versatile utility for one-to-one videoconferencing and has a feature to configure both audio and web cam setups.

This reminds me of the guy who thinks cyber-sex is pretty hot, until he upgrades to a web cam and thinks it just can't get any better than this.

 

Some people like to approach the real thing slowly.

 

I encourage you to go at whatever pace you wish.  As you proceed, slowly creeping up on it, you might take the feelings of wanting to avoid in-person TTP into your video-TTP process.

 

 

Video TTP

 

Might be a good place to visit

if you don't get stuck there.

 

Clip: http://www.ptm.org/01PT/JulAug/

SelectArtcl.htm

Mon, 1 Dec 2003

 

Hammocks and Longer Time Frame


Ed,

While I browse through the FAQ pages, I often find a quote or picture which raises feelings which I know I need to address (Which I'm sure is the point of FAQ).

 

The most recent finding is your response to a question (Sat, 3 May 2003) which partially consists of a picture of a couple laying on a hammock, along with the caption "High Paying Trading Job." It is not the question, nor the answer, which piques my interest, but the picture and caption itself.

Even though I do not spend much time in hammocks, I find myself having more and more free time, and needing less time in front of the computer, since adapting a longer term trading method. While the television airwaves are inundated with "opportunities" (No money down, etc.) to live the American Dream and have the free time to spend with family and friends, and while many would cherish such an opportunity, I find myself having feelings which may get in the way of my trading. Perhaps they already are.

I am surrounded by family and friends who all work very hard at what they do. They work all day, and they are happy to have a few hours per night to have to themselves and their families. Up until a year ago, this was the case with myself, as I commuted everyday to the trading office. I finally decided to start trading at home just to have the serenity, and to eliminate an atmosphere which seemed to promote overtrading.

 

I am still trading at home, enjoying the atmosphere and the process. But every time I enter a trade, enter the stop, and walk away, I can't help but think about my dad, who recently retired, getting up at 5:30 every morning to beat the rush hour traffic, and then coming home between 5:30 and 6:00 every night. He made it to middle management in a major corporation and I can't imagine the B.S. he had to put up with ten hours every day. This is not mention my mother, who was a teacher, and my two best friends who run a business together and have a similar time table.

I think about this while I remember Mark Cook's interview in Stock Market Wizards when his father had a heart attack out in the field while Mark was in his office making ten times what his father was.

In contrast, I also think about the end of Bill Lipschutz's interview in New MW's when he said working hard means "commitment and focus. It has nothing to do with how many hours you spend in the trading office." I love that quote since there have been many times with others when it seems like I'm not even in the room. They don't even have to ask what I was thinking about anymore.

I've told myself again and again that that anyone can do what I do. I've put in the work, I'm willing to take the risk, and things are finally working. Just keep doing what your doing and don't deviate from what works. This must be to justify what I do without feeling the feelings that are inside.

Sometime I wonder if my friends and family truly believe it is possible to be successful without being at a desk in front of a computer all day, every day. The only evidence I have is my word and my statements, since I have not even made any plans for any new purchases.

 

I am very frugal person due to the fact that the last time I made a lot of money, I spent it because I thought I was successful and I was going to stay that way. Didn't happen. Started over and here I am. The point being, as I write this, it's almost as if I need to prove to myself and to others that I'm doing well, and I'm not going to blow it again, and according to some, maybe even myself, that means living up to the image of the trader you see on T.V. You know, the guy with a phone on his shoulder, both hands on the keyboard, shouting out orders to assistants -- high-paced, well dressed, Wall Street, working his [xxx] off all day kind of guy.

Wow. That felt good. I think I scratched the surface there.

I know I shouldn't need permission from others to be successful, but I know I need it from myself. Just seems very hard to come by.

Thank you very much for your time. I have a lot to think about.

Good Work !

 

In some quarters, adults train children to suppress the experience of success. This sets up a success  knot. Some people call this knot guilt.

 

One way to dissolve the knot is to  experience it - that is, experience the the feeling of not wanting wanting to experience success.

 

You might continue your process by finding finding receivers, to help you stay on track while you experience your feelings.

 

 

 

Rembrandt's Prodigal Son

 

Communicating his guilt

to a good receiver

 

 

Clip: http://anika.freeshell.org/

light/contrition/

Mon, 1 Dec 2003

 

Trend as a Law of Nature?


Hello Ed,

Intellectually very stimulating content. I really enjoy it. Thank you.

Term "trend-following" implies that trend exists. You seem to consider the existence of trend as a law of nature (or axiom, or dogma) and as the only valid approach to markets.

I fully accept trend-following as a way to approach markets, but haven't figured out how it works in some markets.

 

As well, I have a difficulty to accept only one truth without understanding it (or "experiencing it" as you would probably say).

 

Thesis that "markets fluctuate" seem equally valid to me as "markets trend". I feel more comfortable to look at trading systems as mapping human behaviour, be it trend-following or reversals or whatever (save for the rest of it -- money management etc.)

I would appreciate, if you help me to end my confusion: Do you consider trend-following as the only valid approach to markets (i.e. other approaches do not work)? If trend is flat, can it still be considered as a trend for trading purposes?


Has your devotion to trend-following something to do with inflationary markets in the 70's?

Yours sincerely,

All profitable systems trade trends; the difference in price necessary to create the profit implies a trend.

 

Some Trend Traders wait for trend momentum to develop and then trade in the direction of the trend.

 

Some Value Traders figure out the fundamentals and try to determine low and high prices in advance.

 

Some hybrid systems may look for, say, trends in earnings, or high sales-to-inventory ratios and then enter and exit on technical formations.

 

Fundamental systems have structural drawbacks in that the analyst has to identify ever changing factors that other analysts have yet to discount.

 

Technical systems are counter - emotional in that people  (1) like to buy low and sell high and (2) like to understand "why" things are happening.

 

No matter how you enter and exit trades, be sure to have position sizing and risk control methods in place.

 

 

A Good Exit Strategy

 

Actually Gets You Out

 

Clip: http://www.arabia.com/mersal/

help/images/exit-msg.gif

Mon, 1 Dec 2003


Dreams

(submitted Tue, 25 Nov 2003)


Fred is alive and well in my dreams again. Last night a particularly disturbing dream caused me to feel such sheer terror that I became paralyzed with fear. In the dream I was so scared, so full of fear that I lost control of my motor skills and fell to the floor and was unable to get up. I tried to scream aloud but my cries were stifled. It seems now that I was so stricken with uncontrollable fear that I lost use of my voice and was unable to cry for help.

When I woke up the feelings still lingered somewhat and I was very uncomfortable. I felt like a little kid who, after having a bad dream, was too frightened to be alone. It was very surreal and creepy, so much so that I could not continue to try and experience what it was that I was feeling. Quite simply, I was too frightened.

My question is this Ė can the sender ever reach a state similar to the one I experienced in and after my dream while on the hot seat?

 

Can feelings of utter fear be experienced through TTP such as the ones I describe above or are the feelings evoked by the dream more intense than what one would or could feel through TTP?

Thanks again,

Fred seems to want to communicate  fear to CM. 

 

If you block this, Fred may set up situations for you in which you feel fear, such as nightmares, even fearful real-world situations.

 

To the extent you encourage Fred to communicate the feelings to CM, the need for fearful drama may decrease.

 

A good receiver can just be there with you and encourage you to go through your fears without flinching or trying to fix you.

 

 

 

Fred Sets Up Fearful Drama

 

Fred makes a trader watch talking heads

on the Funnymental News Network.

 

 

CLip: http://www.painhelp.com/

chronicpain.htm

Mon, 1 Dec 2003

 

Back & Anger

Progress Report - From Reno Workshop


Hi Ed,

 

I wanted to send a note updating my progress in a few areas since my return from Reno. One thing I never mentioned in my previous email was that I was in a bad car accident over 20 years ago that causes me chronic back pain. It may not be consistent back pain but when it arrives it stays for some time and causes me to be very immobile, to the point where it is often a huge effort just to get out of bed. Once I am vertical then I have learned to live with the inconvenience without much complaining.

 

I had a flair up two months before (best recollection) going to Reno. When I committed to the tribe on Sunday I noticed a number of changes in me but one I noticed was I had no back pain. I donít actually recall when it departed but it was gone before I left for the airport. Once I returned home I tried for almost three weeks to have the back pain return and it would not. This is amazing because I know that if I sit a certain way or move in certain directions that this back pain can easily resurface. It has not returned in any form as of this email. I believe a number of judges were lifted (from being in Reno) thus causing the pressure to be relieved, but I donít know. But more importantly I have stopped asking myself why, it really doesnít matter.

Upon my return from Reno I did not have a single anger outburst for 17 straight days. This might not seem like much to most people but for me it is about 16.5 days more than I have ever gone before. And in that time I only raised my voice twice. When I had the outburst I distinctly remember not liking the feeling but still feeling the feeling. This is another huge improvement for me. I was so excited about what I was taught in Reno that I wanted to pass it along to the rest of our Tribe. Jason was thinking the same and we scheduled a one day intensive workshop for our Tribe. I was both a student and a teacher and I found the experience an extremely beneficial one. I know from the group experiences and the thank you that I received, that a number of fellow tribesmen had life changing events from the day.

I even used the TTP process with my 8 year old son. He had done something wrong and was sent to the bottom of the stair step and told to think about what he had done. Normally after some reflection the individual on the step would get up and apologize to the individual that was wronged. But in this case after a few minutes on the step I sat down on the step with him and I asked him what he was feeling and where he was feeling that feeling. I was so shocked at his explicit descriptions of what he was feeling and where he was feeling it that I did a poor job as receiver. I tried to do a better job with more probing but I think I was still in shock at his descriptions. Now it is my goal to help each of my children feel their feelings better and not carry around the amount of baggage that I carry.

I have truly found my right livelihood. I look forward to everyday even more than I did before. I know all the tools are within me.

THANK YOU again for your teachings. I would love to plan something for the TO tribe where you come to Toronto for a day or two. Just a thought.

Thinking 180 degrees, all the best

Yes. Good Work !

 

 

 

 

You Can Solve Back Pain

With Massage, Chiropractic, etc.

 

You can Dis-solve it with TTP.

 

Same for anger

and other feelings and emotions

that all have positive intentions.

 

 

Clip: http://www.painhelp.com/

chronicpain.htm

 

Mon, 1 Dec 2003


Living in the Present

Dear Mr. Seykota,

Thank you for the website. One of my activities on the weekends is to revisit the old FAQ. I started from the first posting in January 2003, and I am only in late March. Every time I read it, I learn something new.

 

The two core concepts I get are: 1) Intention = Results, and 2) Embrace the flow of communication from Fred to CM.

 

Once I see the problem through the lens of those concepts, a lot of the answers make perfect sense. I feel the ideas flowing inside me.

I guess you are right: When the student is ready to learn, the teachers will appear, usually free of charge.

Throughout this time I have an increasing appreciation of trend following, as I moved from mainly top-picking/bottom-fishing to mostly buying breakouts/selling breakdowns. However, I think there is still some residual doubt on the idea of trend following, which makes me not fully accepting.

I think part of the doubts come from reading Nassim Taleb's Fooled by Randomness, in which he mentioned the Black Swan phenomena, namely, no enough observations of white swans can prove that "All swans are white." Therefore, I think deep down I still hold some doubt that, perhaps one day trend-following will cease working.

The interesting thing is, as I realized my doubt, I found an answer from the
FAQ, as if you were telling me the answer. Worrying that something may happen in the future, I cease to live in the present, in the now. Immediately, I remember what Mark Twain said, "I have lots of worries. Many of which never come true."

I take this "worrying about possible things in the future" to a mini-TTP. The result is that I start to appreciate uncertainty, just like football games are more fun to watch when the game is close, simply because the outcome is uncertain.

Yet, I don't think I have completely resolved the issue of doubts. There is still some lingering concern whether trend-following will continue to work. So I take this "lingering concern" and see what it feels. This time, I feel a positive intention: to protect me from possible harm.

Despite all these experience, appreciation, and realization, CM still rules. I find myself still pondering, "Does it mean making plans for the future not living in the present? Does it mean preparing for possible scenarios in the future anti-trend following?"

Say you buy at A and sell at B. Then to show a profit, B must be greater than A. That is also the definition of Trend.

 

All systems that make money trade trends, otherwise A and B don't line up right for profit.

 

There are many ways to trade trends; some try to anticipate them (Fundamentalists) and some just hop on them when they happen (Trend Traders).

 

Another important part of trading is risk control.  Trend traders can control risk with trailing stops.

 

Fundamentalists and anticipators may have difficulties with risk control since a trade keeps looking "better" the more it goes against them.

 

 

 

Fundamentalists Know When

To Catch a Falling Knife.

 

So do Trend Traders.

 

answers:

when it's cheap

when it stops falling

 

Clip: http://www.13pt.com/piws/8802.html

 

Mon, 1 Dec 2003

 

e-TTP & In-Person TTP

Copy of Inter-Tribe Communication

Dear Friends,


I endorse 100% what [xxx] thinks (below). Really TTP is not only for traders and there many people everywhere in the path of self-development that can be receivers - senders in a TTP or a Hardball session. For those not having a Tribe around this is worthy to experience.


Best for all

 

-----

 


Hello Everyone,

I think its best that we stop this discussion of going back and forth via email. As Ed pointed out there are significant limitations to doing TTP via email, the CM seems to be fully engaged. TTP is actually a lot simpler, just focusing on feelings and bodily sensations, no need for lengthy explanations.

Yes.