Your Turtle Trading Questions Answered
Who Are the Turtles
Just over twenty years ago a lone futures trader stunned the world by
turning a 'grub-stake' of just $400 into an astonishing $200million.
Then.... in 1983 he personally taught his secret trading method to 14
ordinary people whom he nicknamed 'The Turtles'. The results have been spoken about in awe ever since because…
…over
the next five years, The Turtles earned some $175 million in profits using the
exact same system! It seemed that anyone could just copy the Turtle System and
use it to generate huge profits for themselves.
All
were sworn to strict secrecy, and although many outsiders have
since tried to discover
the genuine Turtle Secret for themselves
- all have failed.
But
now, at last, one man - an original Turtle - is prepared to
reveal exactly what went on
behind the closed doors of that
meeting room in Chicago. Finally you can learn the
outstanding Turtle Trading System for yourself - taught
directly by original Turtle,
Russell Sands. His story is quite
remarkable…
Who is Russell Sands?
Russell Sands Is The Only "Original
Turtle" Teaching These Methods Face to face
It's true. Because of an obscure
clause in his original agreement , Russell Sands is the only one of
the Turtles now free to teach these methods. Which means you are not
only getting this information from the original source you're
getting it from the ONLY source!
Q1> Assume I had no trading knowledge nor experience, will the
seminar be sufficient to teach me to trade profitably, provided I just
followed the "mechanical rules" consistently?
A.1>> Yes, the Turtle Program was designed to do just that. Its
objective was to teach beginners with no trading
knowledge nor experience how to trade as long as they could consistently
follow the rules and have enough trading
capital for the market they wanted to trade.
Q.2> Any personal "judgement" required? Do I need the flair,
personality etc. in order to be a successful trader
(even after I had attended the Seminar)?
A.2>> You do not need to use judgement or have "falir" as you say if you
follow the mechanical rules. That being said. You will be taught both a
mechanical way of trading and a Judgement way of trading that is
qualitatively the same way of trading - where you can have input. Some
people like to exercise judgement some people like to be mechanical -
the Turtle Program recognises this as a personal preference and caters
for both personalities.
Q.3>Is it a "Black Box" software system approach? Or, we will be
taught the principles and theories to be applied intelligently with
understanding?
A.3>> By Black Box I assume you mean "trader does not know all the
rules - blindly follows the rules spat out by a computer" If our
definitions match the answer is a most DEFINITE NO. It is not a Black
Box software approach students are taught all the rules and the code of
the software is open for Turtle Students to see.
The answer to the second part of your question is Yes. You will be
taught the principles and theories to be applied intelligently with
understanding.
The Turtle program covers more aspects of trading than any other Trading
course I have seen in 18 years of trading and learning different
methods.
Q.4> Which markets does it apply to?
A.4>> The Turtles Method was designed to treat every market the same
way. Turtles like to trade the commodities, futures and foreign exchange
markets. Many students have applied it to the stock market with
documented success.
Russell Sands has done some extensive research and come up with a recent
modification to the Turtle method that filters some of the false moves
in the share market. This All New method will be Unveiled at the
Singapore seminar
for the first time.
Q.5> Any personal "judgement" required? Do I need the flair,
personality etc. in order to be a successful trader
(even after I had attended the Seminar)?
A.6> You do not need to use judgement or have "flair" as you say if
you follow the mechanical rules
But in the book, "Market Wizards" by Jack D. Schwager, it was mentioned
that Richard Dennis considered that personality, judgement and flair
were what make a successful great trader."
A.5> Firstly, look at the words. There is a big difference in the
connotation of "successful great" and "successful". Successful in my
mind is profitable on a consistent basis over time.
A great trader is one that really stands out from the crowd - like
Richard Dennis himself.
Richard Dennis had "personality, judgement and flair" and is a great
trader. Yet, he recognized that not everyone had that and that some
people were good at just following the rules and that's why he created
and taught two different ways of trading to the Turtles to suit the
various personalities
One is Mechanical and is called for want of a better word the "Turtles
System" - just follow the fairly simple rules consistently.
One is Discretionary and is called the "Turtle Concepts" - that gives
you a Checklist and a philosophy of trading that allows you to exercise
your judgement.
As you would expect those traders who like to follow rules and be
consistent will have similar trading results to each other and the
System. That means they will be more predictable in trading outcomes.
The ones that use the Concepts ie their Discretion within the guidelines
will have more variable results giving them the opportunity to stand out
from the crowd and be what Dennis termed "successful great trader".
Q.6 How can I pay for the seminar?
A.6 Go to 41a Boat Quay with a cheque or credit card today to confirm
your place.
Or Call 6535 1949 Or click here to order online>>
Russell Sands Responds To His Critics
1. If you’re such a good trader, why do you teach seminars
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Well, I could give you a whole bunch of charitable talk about how I
enjoy helping people, which is true, but the real crux of the matter is
that the most important reason is money.
I have some valuable information, I am a good teacher, and people are
willing to pay me for it.
I am a real (and profitable) trader, but even the best traders in the
world go through some losing periods. Teaching is guaranteed income,
with no variance, and no drawdowns.
I run a business and finance a household, and have expenses to pay every
month. I cannot very well tell my programmer or my banker that I will
pay them their salary or mortgage payment the next time I catch a big
trade (whenever that may be).
Also, if the teaching income allows me to pay all my business and living
expenses, then I can allow the trading profits to build up and
accumulate in my account.
And finally, people tend to like to do what they’re good at, and I
happen to be very good at teaching. Maybe better than I am at trading.
Many people, from large money managers to exchange executives, have said
so. I still think I’m a pretty good trader, with over twenty years
experience and still going strong. But you know, some of the best
hitting and pitching coaches in baseball were only ‘average’ players. So
even if my trading track record is not hall of fame material, that
doesn’t mean I am not well qualified to teach others.
I also like to make money. And my time is valuable.
2. Russell was fired from the Turtle
program for not following the rules, and never made any money trading
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There has always been a lot of controversy surrounding this rumor, and
the truth of the matter is that I never was fired, but that I resigned.
And my disagreements, if any, with Richard Dennis, had nothing to do
with not following the rules. I resigned over a difference of opinion as
to what was ‘secret’ information and what was common sense. I came to
this job with more experience than most, and it was common sense to me
that you trade larger volatility positions with smaller size, and vice
versa. I was overheard discussing this with some of my option trading
friends one day after work, and all of a sudden I was accused of leaking
out proprietary information. I thought it was silly then, and twenty
years later, I still think it’s silly.
As for not making any money, well, 1984 was a tough year. The markets
were choppy, and nobody made any money for about the first nine months
of the year. Rich himself lost money, and kept telling everyone else
that losing money was not an indication of doing anything wrong. In
fact, at one point he even came in and said that anybody who was making
money at that time was probably doing something wrong (not following the
rules).
Of course, extrapolating what happened in a nine month period over
twenty years ago into saying that I have never made any money trading,
is also pretty silly. If I didn’t start making good money at some point,
how could I possibly have any credibility to still be in this business.
3. Russell Sands was fined by the NFA
------------------------------------------------
When futures and commodities brokers see this they understand fully -
brokers are fined almost incessantly.
floor traders of the SFE were fined for swearing in the pit. One
Australian trader I heard of was fined for writing his orders in Blue
Pen not Black Pen as per the rule. Just to put things in perspective,
Merrill Lynch and Goldman Sachs and a bunch of other large brokerage
firms were recently fined over several hundred million dollars for order
execution infractions, but they still seem to be in business as well.
Yes, it’s true. In 1997, I was fined $20,000 by the NFA Business Conduct
Committee for misleading advertising material for one of my seminars. I
had produced a graph with a five year track record of my nightly Turtle
hotline. The first year was a computer generated model, and the next
four years were the results of an actual account I had set up. However,
the graph did not have the accompanying hypothetical boiler plate
disclaimer underneath it. Big deal ! In fact, The NFA prosecutor in the
case, Ron Hurst, did not think this was such an egregious violation
either, and approached my attorneys before the hearing with an offer to
settle the case, but I refused because I wanted to explain my side of it
and be completely exonerated. Considering that the NFA needs to justify
(and pay for) its existence, this was pretty naive on my part.
The simple truth is, given the (sometimes ridiculous) regulatory
environment in this country, any large entity is going to at some point
encounter minor infractions in the course of doing regular business. I
paid my fine, considered it a frustrating cost of doing business, and
continued on. I never lost any of my registrations or trading
privileges, and the matter has been put to bed.
4. Russell quit trading two years ago, saying the system didn’t
work any longer because things had changed
The Pacific Turtle Fund (my major trading Fund) was closed down by
agreement by the directors. The reason
behind that was as follows:
1. The Fund had high administration fees
2. Government Tax policies changed so that investors in Cayman
Island Funds lost their anonymity
3. The largest investor in the Fund accounted for over 80% of the
investments.
4. That investor decided they needed the money back
5. To maintain a smaller Funds Under management size on the fee
structure with not much
chance of new funds would have meant a drag on the returns of
the existing Investors
6. Richard Dennis had closed down his fund (more on this later)
7. Because of point 7 I did think that something had gonbe wrong,
and I did say that, and I did quit.
And I was dead wrong. Hey, first of all, everybody is entitled to an
opinion, no matter how silly it may be,
and second of all, everybody is human, and makes mistakes. I said
what I thought at the time, wound up making
a big mistake, and I have seen the light and since changed my mind.
I was influenced by the opinions of others,
including that of my original teacher, during a time when trend
following was going through a long and extended
drawdown period. I was tired, and burned out, and lost my tenacity.
I should have known better, but I guess I
didn’t realize it at the time.
A year later, I saw how wrong I had been, and in fact, wrote a very
lengthy report (free to any of you
for the asking) in the beginning of 2003 explaining all of this. I
have always had a reputation of being very outspoken about things.
Not everyone likes me for this, but I always say what’s on my mind,
and don’t pull any punches. I said what
I believed at the time. And if/when I’m wrong, which sometimes does
happen, even to me, I admit it, and correct myself.
5. Richard Dennis blew up a trading fund – twice—
Well, I’m not sure that “blew up’ is exactly correct, but it is true
that on two separate occasions, public funds managed by Richard
Dennis suffered large losses and had to be closed down. As far as I
know, one of these cases was completely Dennis’ fault, and the other
was really nobody’s fault, but let’s look at each one and put them
in perspective.
In the first case, about 15 years ago, a public fund run by Drexel
Burnham had to be shut down because the account lost 50% of its net
asset value and reached its legal termination point. I have no idea
how this fund, managed by Richard Dennis, managed to lose all that
money, because in that same year, both the Turtle computer model as
well as all the other Turtles that were now working as CTA’s, had a
large winning year. Can somebody say “not following the rules”.
Dennis later admitted that he implemented various new and different
trading strategies, in part because he was afraid that if he and all
the other Turtles kept chasing the same signals, the system would
not work any longer. Well, everyone, both human and computer model,
who stuck with the original program made money, and Dennis, who did
something ‘different’ lost money. I guess if you have a proven
system, and don’t follow your own rules, even if you happen to be
the inventor of the system, you still do not get any special
dispensation from the markets.
Now, as for the second instance which happened just a couple of
years ago, the markets had been going through a long and extended
choppy period, and all trend followers were suffering.
Dennis wound up suffering close to a 40% drawdown during the first
nine months of 2001, and Kenmar Partners (the Fund operators) said
he had hit his liquidation point so they shut it down. What people
forget is that nobody makes money all the time, and even good
traders always give some back. In the previous couple of years that
Dennis had been trading the Kenmar Fund, he had very impressive
returns, such that all the original investors in the fund still
wound up with a profit, even after the losses that were incurred.
Imagine if you started with 100, doubled it to 200, doubled it again
to 400, then again to 800, then took a 40% loss bringing you back
down to ‘only’ 500. You are still way, way ahead of the game, but
everybody just focuses on the (recent) losses.
6. Other people are willing to sell the Turtle system for less
money (or for more money)
I hate to talk badly about other people, even when they talk badly
about me. I have always held myself above that, and will continue to
do so. There are a couple of other guys out there that are marketing
“turtle” trading courses, and saying bad things about me to boost
themselves up. I really have better things to do than get into a
pissing contest with these clowns.
There is one guy who sells a course for about $1,000, which is a lot
cheaper than mine. The only problem is, he is not a Turtle, never
was a Turtle, and in fact, I have never been able to find out
exactly who or what he is. Except that he has a nice slick website,
and apparently a lot of experience with marketing various products
over the internet. He has somehow learned some of the Turtle
material, but by no means has all of it. And what is even worse, I
have heard from many of his disgruntled customers that he is
impossible to get hold of, and his follow up support is
non-existent.
On the other end of the scale, there is another fellow, who is
indeed a legitimate Turtle, and in fact one of the better ones as
far as I can remember. This guy wants to give away the Turtle rules
for free on his website, because he believes (as Richard Dennis has
said in the past), that nobody is going to have the discipline to
follow them anyway. And of course, he is right. But then his company
wants to offer you a week long private trading course for the paltry
fee of $25,000. Well, if you have that kind of money, please go and
be my guest. But I just can’t imagine what he can teach you that I
can’t that would possibly be worth that kind of money, or anything
even remotely close.
The bottom line is that the material is only half the story, the
more important half is the way it is taught. I know guys who are
brilliant traders, but they couldn’t explain to you the first thing
they do, because either they can’t quantify it, or they just don’t
have the right communication skills. The value I give is not in just
giving the rules, but in explaining how they work, how and when and
where to use them, and to support them all with historical testing
to show they really do work.
7. The Turtle system has very bad draw downs
Yep, it’s true. But the draw downs come after a big run up in equity
ie after it has done really really well. Show me any good system
that doesn’t go through bad periods. It just doesn’t exist. It is a
fundamental law of economics, if you want to get a reward, you have
to take some risk. If you are not willing to take the risk, you are
don’t deserve to make anything. You can always go put your money in
treasury bills, at 2% interest. What is important is that the risk
and reward be commensurate with each other. And for the given amount
of risk, there is no greater profit potential than the Turtle
system.
Of course, if you are not comfortable with the risk, you can also
reduce your leverage and trading size down to where you can sleep at
night. The great power of the Turtle system is the flexibility of
the money management rules, which are designed to let you choose
your own level of risk and reward, and to keep you in the game
during the rough periods. Hell, anybody with a computer these days
can figure out halfway decent buy and sell signals, it’s money
management that is most crucial.
8. The Turtle system just doesn’t work any more
Of all the objections and criticisms I hear, this has to be the
silliest. Yes, of course, there are periods when the method just
doesn’t work. False breakouts produce losses, and it can go this way
for months at a time. But this is a long term system, one that has
been consistently profitable (and I mean a 100% per year level of
profits) for twenty years, and will continue to do so.
As I’ve said before, I wrote a lengthy paper on just how and why
this will must be true, which I will be happy to send out free of
charge to anybody that wants a copy.
But hey, don’t take my word for it. Thank god for machines like
computers and programs like Tradestation. There is no computer
program in the world that can predict the future, so I can’t
guarantee that the Turtle method will continue to be profitable
forever. But I can show you that it has been very consistently
profitable year after year after year since Dennis and Eckhardt
taught it to us back in 1983. And there are no tricks here, no curve
fitting, no optimizing. The exact same rules, applied the exact same
way, to all the different markets, year after year. I couldn’t make
this stuff up if I wanted to. You can read the code and print out
the results for yourself.
This stuff works, plain and simple. If you learn the rules, and have
the patience and discipline to follow them, you should be fine. If
somebody, be it Russell Sands or Richard Dennis, or anybody else,
messes up and doesn’t follow their own rules, well can say whatever
you like about the personal disciplinary shortcomings of that person
as a trader, but that still in no way will invalidate either the
legitimacy or the profitability of the system itself. |
