© Ed Seykota, 2003 - 2006 ... Write for permission to reprint.

Frequently Asked Questions

Chart Server  ...  Contact Us

Answers

At the meeting I get into the form of not wanting to deal with this. I go with the process. Eventually I arrive at the form of "I am guilty". I keep saying this, eventually I start saying this in German (my native language): "Ich hab schuld, Ich hab schuld!" It feels great to openly experience this feeling. After my hotseat I don't remember how I got to the feeling and totally forget about the situations my girlfriend challenges me on.

Yesterday we have another meeting. She asks me if I looked into the issue. I hesitate for a second ... AHA. Yes, when she doesn't accept me, I feel I am doing something wrong. I need her approval, otherwise I feel guilty. This is liberating as I feel I can accept her, while also accepting and respecting my feelings.

I am thankful to have such a wonderful girlfriend.

warren_dennis_gallery.htm

Ed, I've read of people being your apprentice for you in the past and was wondering if you still do this?

I sometimes have space for an apprentice who wants to work hard in exchange for room and board.

Day Trader Video  

Nice forms.

It has been 40 years since I was in college, so pardon that some things are somewhat more dim.

Found your site while searching the web to review Bernoulli's principal for the following practical problem:

I just finished cleaning an astonishing amount of lint clogging the dryer exhaust pipe (std. 4" dia). This was not an easy task, but a necessary one for the efficiency of the dryer and safety in that a lint clogged exhaust is a fire hazard.

So instead of going to sleep, the mind started grinding away, - it seems a fact of life that ALL dryers expel some lint that gets past even a religiously maintained lint filter in the machine. This winds up in the exhaust airs tream, and in some installations the exhaust piping can be a long run with a few right angle bends in it.

So - can I design a lint filter to put onto the exhaust that can be easily cleaned and low restriction?

The concept is air coming from the dryer carrying some residual lint goes into an expansion chamber, and then exits back though the same diameter (4") piping. If the incoming air stream enters from a 4" diameter pipe with a 4pi cross sectional area, and the cross sectional area of the expansion chamber is 4 x 9 (rectangular is easy for me to fabricate (and would have a Plexiglas cover so I could see if lint has accumulated and is easily opened for cleaning, I would anticipate a ~3x reduction in airflow velocity which would (I hope) allow the lint to drop to the bottom of the chamber. Air would be vented from the top of the chamber through and regain most of it's input velocity, in theory sans lint?

Clip: http://bakedbeats.com/poptart/images/lint.jpg

As I muse and meditate on your parable for its purpose & meaning, I discover a different perspective of looking at trading, living and training the martial arts.

Before I gain Mastery, I must become a good student. I seek knowledge within and without (learn from a Master). I am willing to pay (trade) my price (risk) in exchange for my success (reward). I empty all pre-conceived bias, opinion and prejudice to become available to new ideas and information. I experience the new ideas for myself by doing, acting and practicing. My focus is on my lessons and my learnings, NOT the Master's methods and his teachings. I learn from mistakes by trial. I discover my Truth from seeking within. I try not to repeat mistakes.

Clip: http://www.nada.kth.se/~asa/bilder/jade.gif

Ed,

Thank you sincerely for presenting the Trading System Project. I have learned more than many book reads! I can’t wait to see more.

OK.

I wish to share with the greater trading tribe. I grieve my trading losses. I grieve them today. I feel and experience the feeling that losses generate.

I thank my trading tribe for supporting me in feeling my trading losses. On the hot seat I experienced my feelings about loss. I felt these feelings and I experience them.

Clip: http://www.nancysherman.net/grief.html

Ed,

I’ve been studying the Trading System Project for a couple of days, but I can’t find a mathematical definition of “heat”. Is it given somewhere on the site?

Clip: http://www.pierresilber.com/sexybikinis1.html

I will try to do this when I feel them coming on.

Also your suggestion that I could be using my "drama like a drug" was probably correct.

The human mind is indeed highly complex!

I have an idea for your site, but I do have a selfish reason for this but that aside I think it will be well received by readers.

As most participants of your site are system traders / programmers, its likely that a resource centre for programmers to share their ideas, and seek programming help would be popular.

You could make it like a bulletin board, where readers could post follow ups to respond to the questions of others.

Of course you can edit them, or remove material which you deem as unsuitable.

Its clear you have a large number of high caliber readers here, and this could bring a new dimension to your site.

Perhaps to make allowance for your time in doing it, you could make a small $50 annual membership charge?

[Code with some problems]


I don't expect you to fix this for me Ed, but perhaps you could post it, and see if anyone has an interest in the above scheme? Or if anyone can find a solution perhaps your could post my email address with it.

membership/net_vs_paper.html

The one lesson that I have learned from you and have always remembered is that the money is to be made on the long side.

Thank you for staying in touch.

I commit to next workshop

I finally drop dim. I attend a Tribe in another city.

My intentions are to remove knots.

My preliminary results ("feelings") are hard to rationally explain, but I feel good.

Events came up that I didn't even remember.

Thanks for the effort.

I notice your glossary is improved and refined.

History has shown emotional domain to be largely play of manipulation, this is very interesting.

Thank you for sharing your process.

We had the first tribe meeting in Houston with wonderful results. Three members to start and breakthroughs already!!!

OK.

Monday 23, 2006: my daughter is born ! I'm proud to say it to all of you out there !!! After all, we share a piece of life here on Ed's FAQ as a giant tribe and I feel such a wonderful feeling to welcome our child in my little family one.

Congratulations!

Sir,

Knot formation in kids - your views on noticing them during their formation and steps to be taken to avoid them, during their upbringing.

You might just toss it. But a thank you for everything and I been pretty good with holding the position now.  I guess markets good but I believe the big contribution is getting my life together step by step and Risk Management. Surprisingly another tribe might have a first meeting next week. Then again it might just be me setting up for disappointment like what happen today at work. Good luck and thank you for your contribution dearly sir, you are a wonderful person.

uncle-sam/no-drinking-sign.htm

Unaddressed, the rock becomes a way of life and we pass on the injury (ies) that make for similar rocks. A big enough rock with powerful drama (s) becomes obsession (addiction?) and seems big enough to dominate much of our attention and energies. In addiction we spend our time in an eddy full of stale water swirling around a big stinky rock instead of flowing along the hills and fields, across the topography of life. We are afraid. We hide.

Trust gives me the faith to risk releasing myself from the old life around the rock. Trust is the flowing fresh water. I call trust, "confidence in my self, in my choices in my friends". Trust is confidence in my leadership of my own life. Much of the leadership consists of surrender. Go figure.

Thanks, Ed, for being who you are and for sharing what you feel. It helps me trust.

Graceful_Horses/white-horses.jpg

I am willing to pay for your services and come to see you if that is necessary. I have attached the results of my system. Thanks again for sharing and inspiring me to get to this point. I really like the addition of Rocks to TTP. It is very helpful to my evolution.

Sincerely,

I am currently assisting some people.  If you would like me to assist you, tell me what you want me to do.

Dear Ed:

I enjoyed reading about you in Market Wizards and Trend Followers.

I'm working on a project ... I was wondering if you would be willing to answer four or five simple questions (by email) about the financial markets and trading in particular.

The interview should be featured in [Publication] in about a week. Of course we would provide a link to your website -- or to a destination of your choice.

Please let me know if there's an interest or a fit.

You may send your questions in to FAQ and then send your readers to FAQ to get the answers.

The rock in my hand that holds all this, feels acid. I get detached from it and almost have to laugh. Not accepting the rock leaves me with a dazzled feeling, not knowing who I really am. It is a feeling of wonder I remember from a long time ago as a child when you wake up in the morning and are curious what the new day will bring. The warm, salvaged feeling I always had when someone took a conflict away from me is not there anymore. It is replaced by a feeling of responsibility for my actions and with curiosity where this situation will lead. Especially the feeling of responsibility for my actions is very high.

Today I am back in the same conflict situation as before and I almost have to say I like it. I try to find out what might come out of it and move on. Of the physical reactions a very slight headache still remained. The rest is totally gone. The headache was interestingly the only part of the pattern I did not consciously address in the process. I keep it for know as an indicator for specific situations. The connection I have to this symptom has changed. I feel the light headache and at the same moment I feel my childhood “wonder”-feeling and responsibility. It is still weird but I like it a lot.

I really appreciate the help from the tribe. Thank you. My life is getting better with you.

Clip: http://www.pbase.com/jwalk/image/23396340

Hi Ed,

I am thinking about how space in music creates music and how space between my trades creates profits for me.

Clip: http://www.aiai.ed.ac.uk/~bat/ga/SC-MODEL/IMRIE/GALLERY/bat-space-1.jpg

Hello Ed,

I have written some C++ code to test your Exponential Average Crossover system. My fast lag (15) matches yours, but my slow lag (150) is a little off. This results in one extra trade for my system (as indicated by the example metrics I've pasted), and one trade that is started a day early. The other trades match up.

Thank you for sharing your process.

I'm just dropping you a quick note to say thank you. Your teaching style is very frustrating at first but I'm really coming to understand how you help people and you have helped me quite a lot.

You thank me (and others) best by living your own life to the fullest.

Dow Breaking Out

The DOW is breaking out!

Along with buying breakouts and riding winners, remember that Trend Trading includes managing risk and cutting losses.

Hello Ed,

Okay, I'm taking the FIRST BIG STEP and I'm leaving my job w/ security and benefits ... to help someone else successfully create their vision.

I want to pursue my own desires, but for some reason I feel compelled, at this time, to help another other person successfully launch their enterprise. The benefit is that I can demonstrate to others in the industry, "I did this. I made this happen, and I can do it at any time."

For some reason, I feel this is right. I know I can successfully spend my time and energy launching my business but, at this time, I prefer to help my neighbor plant seeds in his field for harvest. What is this altruistic B.S.? I am sincerely interested in your thoughts?

Plunger_Shop_Tools-resized200.jpg

We have $50,000.00 cash to invest over the next 5-10 years for our two children's college education. This is money we inherited form our parents. We are prepared to let you manage it without ever questioning your methodology or interfering with any decision you make. In fact, we are so confident of your ability to manage money, we are prepared to loose it all.

We are currently home schooling our two children with the intention for them to become medical doctors. Our thirteen year old daughter is already studying for her GED and next year we plan for her to begin her SAT studies. As you can surmise we take the education of our two children very seriously.

Please help us by managing our children college finance.

Thank you for your prompt consideration.

Steppingstones/principles.htm

Furthermore I do not have any contacts in the stock market. Only wealthy people can call their broker and ask some questions.

uk/2000/newsmakers/2285287.stm

Hi Ed!

I recently finished my test with trading both, gold and S&P500, simultaneously, so I can confirm your results from your diversification study.

OK.

I read Rocks and would like to find out more information about how to participate.

I’m a member of the City Tribe, and could come to Incline meetings to learn more.

I am preparing some materials for this site and for the January 2007 Workshop.

Hi,

I have begun reading the long list of FAQs. I noticed that many hyperlinks do not work. Is there a reason for pulling them down? Could you tell me where I can find Donchian's trading rules?

Try Resources, above

TSP - Trading System Project
 
Hi,

Here is my solution to the exponential crossover TSP.

The benchmark does not come to the exact figure shown on the TSP example. I got to this figure by multiplying the previous day’s total by 1+(ln 32.71667904 / 5870), 32.71667904 being the ratio of the target benchmark and 5870 being the number of days the system covered. I think the difference is down to rounding on excel.

My next step it to take it onto a more sophisticated program where by I can use the parameters across different markets and find optimal rules more easily.

For anyone struggling to crack basic problems in constructing this in excel I am happy for you to look at my example and see how I approached the problem. Also if anyone has any better solution in excel then I’d be pleased to see it.

A problem I encountered with this is the automation in calculating bliss, in this solution I manually found it for the one set of parameters and simply used the quoted figure in TSP for the second set. Of course without finding bliss there is no measure for optimization and as such I can’t progress. This is something that has stumped me for months and is now holding me back and if anyone can shed any light on this I’d appreciate it.

Another problem I am finding is that different markets I download for the same period might have different days removed for public holidays. This means giving a portfolio equity level isn’t simple as adding equity on the same line in different markets is adding different dates together. I struggle to see a way around this without manually going through the data and inserting or removing days so they line up. I’m sure in more sophisticated programs there is perhaps an easier solution.

Still, I feel a sense of pride in having matched the equity to a penny and that will spur me on to find answers to future problems.

This exercise has rewarded me and stretched me and I would encourage anyone to take it on, your programming skills could not be worse than mine and I made a go of it.

It has also taken the fear from the market for me as I can see why the system is trading and what might cause it to trade again.

I’m finding it tough to build a system but know when I do I will stick to it. I get frustrated reading about people with good systems and enough equity to make it work and earn a living from it who won’t stick to it. I feel I offer half of the equation already and am working on building the other half and feel reaching zero variance as an Associate will be instant for me.

Thank you for sharing your process.