Turtle Traders suck?

[ElectricSavant]

You captured the essence of the Turtle Trading Methodolgy....

Michael B.

Quote from Trend Fader:

The myth of the turtle trading being systematic?

The whole point of turtle trading is that it can never be backtested. The turtle system was not an exact system or some type of black box where any idiot can do it and make $. Each trader applied a level of discretion.. however the rules were pretty much the same.

Thats why the majority of turtle traders failed. It all came down to the ones that got lucky and capitilized on the big moves. The traders that caught a big move like going long nasdaq past year or short the dollar, long copper... pyramided their winnings and have huge size. Those are the guys that cleaned up.

Such a system can never be backtested because its not the actual buy or sell rules that made them money. What it came down to is how much money they had on the line when they nailed a huge move... and how they handled their positions. When you position trade its all about money management and scaling massive size into your winner. The losers are easily taken care off by using a stop loss or fixed loss.. but the money is made by handling the winners.

Just imagine if u traded 10 markets.. and happened to pyramid heavily into the S&P, Copper, Metals, and shorted the Dollar. The money that could have been made is astronomical.
Whereas another turtle trader could have not pyramided and their profits could of only been a fraction of yours.

Point is.. it all comes down to money mgt and position size not whether a 50 day breakout works better than a 100 day breakout.


--MIKE

 

[ElectricSavant]

Balance....grasshopper....balance

Michael B.

Quote from candletrader:

To implement the turtle system, you need a stomach of steel to endure the drawdowns... by implication, you also need to be well-capitalised... with both of these in place, you have a chance...

 

[nononsense]

Quote from everytick:

The turtles 'edge' was in exploiting fat tails. The same edge that billions of dollars are still behind.

everytick,

You must be a wise guy! I see you understood the turtles 'edge'.
I'm sure it will make you rich!

nononsense

 

[onewaypockets]

Quote from axeman:

Anyone ever backtest the Turtle system on the DJIA just for fun?


peace

axeman

Divergence Software just came out with an eSignal .efs study that they call their "Turtle Trading System"....

"This is an eSignal adaptation of the original Turtle system as described on the Turtle website. The system takes short-term and long-term breakout trades. When trades are entered, a Stop and Profit Exit are set. Add-on trades (a user option) are available per the original Turtle logic. Audible, pop-up and email alerts can also be selected. All parameters are configurable via a script menu and the script is eSignal Backtester and eSignal PaperTrade Broker ready. Source code is provided so the algorithms can be modified and integrated into other studies. Requires eSignal Version 7.5 or better to operate.

http://www.sr-analyst.com/studies.htm

 

[inflector]

TrendFader wrote:

The whole point of turtle trading is that it can never be backtested. The turtle system was not an exact system or some type of black box where any idiot can do it and make $. Each trader applied a level of discretion.. however the rules were pretty much the same.

Thats why the majority of turtle traders failed. It all came down to the ones that got lucky and capitilized on the big moves. The traders that caught a big move like going long nasdaq past year or short the dollar, long copper... pyramided their winnings and have huge size. Those are the guys that cleaned up.

Such a system can never be backtested because its not the actual buy or sell rules that made them money. What it came down to is how much money they had on the line when they nailed a huge move... and how they handled their positions. When you position trade its all about money management and scaling massive size into your winner. The losers are easily taken care off by using a stop loss or fixed loss.. but the money is made by handling the winners.

This is pure speculation and just plain wrong.

I was there. I made over 110% each year during the four years of the Turtle program and over $31.5 million for Richard Dennis.

I also wrote the document on www.originalturtles.org.

The reasons some people made money and others didn't came down to who could follow the rules and who couldn't stomach the ups and downs and therefore traded the rules erratically. Invariably those who varied from the rules did so at precisely the wrong time.

Yes we were allowed to vary from the rules we were given but that was precisely the rope that hung the Turtles who lost money. If you stuck to the rules you made over 100% per year, period.

I have also tested the rules over recent history and they still work reasonably well.

- Curtis