Month: January 2020

Ed Seykota

Yes, the winning traders have usually been winning at whatever field they are in for years.

Ed Seykota

1. He/she loves to trade; and
2. He/she loves to win.

Ed Seykota

Inflation is part of the way societies sweep away the old order. All currencies eventually get debased–like it or not. Compute one penny invested at the time of Christ, compounded at 3 percent per year. Then consider why nobody has anywhere near that amount these days.

Gold tends to be dug up, refined, and then buried again. The geographical entropy of all gold on the planet seems to decrease over time. A lot has been collected in vaults. I project the trend as one toward a central world gold stash.

Ed Seykota

Gut feel is important. If ignored, it may come out in subtle ways by coloring your logic. It can be dealt with through meditation and reflection to determine what’s behind it. If it persists, then it might be a valuable subconscious analysis of some subtle information. Otherwise, it might be a dangerous sublimation of an inner desire for excitement and not reflect market conditions. Be sensitive to the subtle differences between “intuition” and “into wishing.”

Ed Seykota

a. Cut losses.

b. Ride winners.

c. Keep bets small.

d. Follow the rules without question.

e. Know when to break the rules.

Ed Seykota

Fundamentals that you read about are typically useless as the market has already discounted the price, and I call them “funny-mentals.” However, if you catch on early, before others believe, then you might have valuable “surprise-a-mentals.”

Ed Seykota

The key to long-term survival and prosperity has a lot to do with the money management techniques incorporated into the technical system. There are old traders and there are bold traders, but there are very few old, bold traders.

Ed Seykota

Systems don’t need to be changed. The trick is for a trader to develop a system with which he is compatible.

Gary Bielfeldt

I learned how to play poker at a very young age. My father taught me the concept of playing the percentage hands. You don’t just play every hand and stay through every card, because if you do, you will have a much higher probability of losing. You should play the good hands, and drop out of the poor hands, forfeiting the ante. When more of the cards are on the table and you have a very strong hand–in other words, when you feel the percentages are skewed in your favor–you raise and play the hand to the hilt.

Gary Bielfeldt

The most important is discipline–I am sure everyone tells you that. Second, you have have patience; if you have a good trade on, you have to be able to stay with it. Third, you need courage to go into the market, and courage comes from adequate capitalization. Fourth, you must have a willingness to lose; that is also related to adequate capitalization. Fifth, you need a strong desire to win.

How did he do it? Bielfeldt does not believe in diversification. His trading philosophy is that you one area and become expert at it.