Complete TurtleTrader: A Review and Summary of the Book by Michael W Covel

Unlike an actual performance record, simulated results do not represent actual trading. Use of the information contained on the website is at your own risk and the Company and its partners, representatives, agents, employees, and contractors assume no responsibility or liability for any use or misuse of such information. Testimonials appearing on the website may not be representative of other clients or customers and is not a guarantee of future performance or success. Not all users will qualify for funded accounts, and past performance in the simulated environment is not indicative of future success.

Core Turtle trading philosophy: Trend following and risk management

• The students were going to trade the firm’s money and be able to keep a part of the profits.
• Five Percent Online Ltd. (“We”, “Our”, “Us”, or “Company”) operates as a proprietary trading firm.
• The ongoing experiment shows that there is more to it than just following mechanical trading rules.

The students were going to trade the firm’s money and be able to keep a part of the profits. The two men decided to put their debate into action and through the training experiment find out about the nature vs nurture aspect. For Dennis money was just a way of keeping score. Richard Dennis had always thought trading to be something that could be learned. Simulated trading programs, in general, are also subject to the fact that they are designed with the benefit of hindsight.

This is the true story behind Wall Street legend Richard Dennis, his disciples, the Turtles, and the trading techniques that made them millionaires. The moral of the story is that trading can be learned and you don’t need to be born with special skills. I have read about the traders featured in this book and listened to them on podcasts. There were couple of guys from the group who tried to make easy money by selling Dennis’s rules.

Anyone interested in the Turtles story, in the psychology of trading, or just a great American story period should read this book. The only condition is that you have to follow the trading rules exactly as they were taught in the first two-week training session. To settle a bet with his business partner about whether traders could be taught or were simply “born,” the an experiment was conceived. You’ve no doubt heard a bit about Richard Dennis, the trend trading pioneer who discussed his mid-1980’s Turtles experiment in Market Wizards.

The Complete TurtleTrader was Covel’s second bestseller and Stocks, Futures, Options Magazine named The Complete TurtleTrader as one of 2007’s top 10 trading, investing and personal finance books. After having a debate with his partner, William Eckhardt, about whether trading is learnable or an inborn talent, they proposed an experiment where they would spend two weeks training novices in the science of trading and then give them each $1 million to invest. There are quite a few resources there, including articles on money management and trend following.”Brett SteenbargerTrading coach, Psychologist, Author And, by the way, for readers who want to dig a little more into Turtle trading before purchasing Michael’s book, I recommend his website.

The Books

For two weeks, Dennis taught them his investment rules and philosophy, and set them loose to start trading, each with a million dollars of his money. Dennis taught the Turtles his theory-driven quantitative trading approach – mechanical trend-following based on a set of rules. It’s the story of the famous experiment in 1983 about teaching a group of inexperienced people to become traders led by Richard Dennis and his partner William Eckhardt. The ongoing experiment shows that there is more to it than just following mechanical trading rules. In a bizarre twist to the story, in spite of how rigid the trading rules were, Dennis’s allocation of capital to the Turtles themselves was not uniform.

The Intelligent Investor: A Book of Practical Counsel

• This created tension, rivalries and confusion among the group, a fascinating story in and of itself.
• It’s a powerful illustration that, though markets have changed since the 1980s, the dynamics of success have not.
• “The book was wonderful…”Michael ShannonOriginal TurtleTrader
• Dennis was a trading genius and a quick study.

This created tension, rivalries and confusion among the group, a fascinating story in and of itself. The rules are not difficult to grasp – in fact, in the program’s second year, the training for the new recruits was cut down to just one week! This is where we get to the heart of the Turtles story. Most traders try to apply the old adage, “buy low and sell high,” which is why most traders fail. Dennis was a trading genius and a quick study.

Similar Books

He thought about money differently than most people. This fascinating story has also been covered in Jack D. Schwager’s Market Wizards book and in other materials by the author Michael W. Covel. Covel explains the rules, simple, repeatable, and emotion-free, covering entries, exits, risk management, and position sizing. His trend-following system, built on disciplined rules, proved anyone could win in markets with the right framework.

The simulated trading environment in the Hub is designed for educational and evaluation purposes only. Users should be aware that the trading results in this environment do not reflect real trading outcomes. All trading activities conducted through the Company Hub are executed in a simulated environment. The Company is not a custodian, exchange, financial institution, trading platform, fiduciary or insurance business outside the purview of financial regulatory authorities. Five Percent Online Ltd. (“We”, “Our”, “Us”, or “Company”) operates as a proprietary trading firm. Keep your insights organized, jump to key moments, and refine your trading strategy – all in one place.

What trading strategies did the Turtles learn in The Complete TurtleTrader?

Large drawdowns inevitably accompany the quest for large gains, and it’s those large gains that ultimately provide trend following with its edge. For those wanting access to the Turtle philosophy and rules, they’re laid out clearly and unflinchingly. He also casts a critical eye on his subjects, investigating why some Turtles found long-term success and why others didn’t.

Richard Dennis

If you like the review, I recommend to read the whole book. Some of the true / false questions asked from the applicants are listed in the book and I tried to quickly answer them myself. It sounded too good to be true to many and it did change the life of so many people. More detailed descriptions about the legendary ad, people who applied, what they had to do in order to get selected, what kind of traits Dennis and Eckhardt were expecting from the applicants. Some thoughtful points from Richard Dennis about luck in trading.

What role did psychology play in the Turtles’ trading success in The Complete TurtleTrader?

The inspiration came from a trip Dennis took to a turtle-breeding farm in Singapore, stating, “We are going to grow traders just like they grow turtles.” Covel’s segment discussing what separated a successful Turtle, Jerry Parker, from his less successful peers is perhaps the most insightful portion of the book. One of the most interesting segments of the book covers Salem Abraham, who by chance met one of the original Turtles, took a 180 degree life turn, and began his own highly successful fund.

These rules worked—and still work today—for the Turtles, and any other investor with the desire and commitment to learn from one of the greatest investing stories of all time. He reveals how they made astounding fortunes, and follows their lives from the original experiment to the present day. He describes how Dennis interviewed and selected his students, details their education and experiences while working for him, and breaks down the Turtle system and rules in full.

There are twenty more like you, just starting out in commodities, all sitting around trading these huge sums of money. “Buy high and sell higher,” and “sell low and buy lower,” are the fundamental, but counterintuitive concepts of trend trading. He is recognized for his efforts in popularizing the story of the Turtle Traders and their trend following methodology. Covel’s work focuses on educating traders about systematic approaches to the markets and the importance of risk management.

Trend following takes a small town guy at a gas station to trading legend worth $100 million? “The book was wonderful…”Michael ShannonOriginal TurtleTrader “I did enjoy the book…I hope it’s doing well for you.”Tom ShanksOriginal TurtleTrader This inevitably leads money managers to refine the complete turtletrader review (and ultimately eviscerate) the Turtle methodology. Investors who place their money in funds simply don’t want to see 20% of their money evaporate in a quarter.

But not all Turtles were successful after the program. The next chapter is all about the Turtles’ strategies, risk management, position sizing and rules around it. Dennis and Eckhardt were very strict about their rules and they had to let some people go, so not everyone made the cut. One of the key factors here is why people with outstanding intelligence can be terrible traders.