Way of the Turtle: The Secret Methods that Turned Ordinary People into Legendary Traders Hardcover – March 9, 2007

If the term 'Turtles' has you scratching your head, then I will start by saying that they were a group of students brought together by legendary trader Richard Dennis (featured in Market Wizards) in the mid-1980s as part of an experiment to see if successful trading could be taught. Dennis and his partner William Eckhardt (featured in The New Market Wizards) selected two classes and taught them their trend following methodology, then provided each with trading capital and set them loose on the markets.Way of the Turtle is less a history lesson about the Turtles (for that you can read The Complete Turtle Trader), and more a deeper discussion of the philosophy behind the trend following methodology Dennis and Eckhardt taught them and the implementation of that system. The Turtle system has been published in other formats and other places before now, but Faith does more than that in Way of the Turtle. He talks considerably about the requirements for successfully implementing the system and how easy it is to fail with it.To my mind, Way of the Turtle is a book of three primary parts. One is a really interesting discussion of the psychology of traders and the markets. Another is a very thorough exploration of system development, testing, and performance measurement. The final part is specific discussions of the Turtles and their methods.The issue some readers might have is the manner of presentation of the parts.I personally found the chapters on system design, testing, and evalutation to be the most unified and consistently coherent of the book. They progress well and present some things that I have not previously seen in comparable discussions. I found Faith's coverage of the material to be an excellent advancement into somewhat more complex approaches for one who has a decent basic grounding. His discussion of the subject is, to my mind, a virtual must read for anyone look to develop and/or evaluate trading systems.In terms of trader and market psychology, the early chapters of the book are an outstanding exposition on the different biases and mental states that we all go through as market participants in one fashion or another. It was this material, so plainly laid out, which got me very excited to be reading the book. It really is a fantastic look at the things we have in our heads which can create so much havoc in our trading, and Faith frequently cites examples of these things through the remainder of the book in talking about his and other Turtles' successes and failures trading their system.It's in the third subject of the book where many readers may find it lacking. Way of the Turtle, as I noted at the outset, is not a history. While Faith does clearly deliniate the full Turtle system he spends relatively little time talking about the grand experiment which the Turtles were meant to be. Rather he provides views and opinions from his own perspective. Necessarily, that makes for a narrow scope. This isn't necessarily a bad thing. One just needs to realize that going in and be prepared to find it in little bits scattered throughout the text.Here's the biggest rub - at least for someone expecting to come away with an immediately useful trading system. Even though the book does tell you exactly how the Turtle system worked, don't expect it to be something you can use yourself. It was specifically designed for use across an array of markets by traders with a large capital base. By that I mean hundreds of thousands of dollars, minimum. As such, the vast majority of readers will not be in a position to make use of it.So it's a question of expectations. Are you looking to become a new Turtle and trade just like them? If so, you're probably going to be disappointed. If, however, you are looking to learn from the experience and education of someone who was there, who learned a great many lessons under the tutelage of a pair of legendary traders, then you will probably come away from reading Way of the Turtle quite satisfied.

This is the best book on systems trading I have ever read; and one of the best on trading in general. Written by Curtis Faith, who was named by The Wall Street Journal as the most successful turtle in the experiment, it has incredible insights into market behavior and the reasoning behind the breakout trend following system used during the experiment. Every part of this book is an important work, right down to the Acknowledgements, Forward, Preface and Introduction. Question after 25 year old question is answered directly from the horses mouth. It couldn't have been written better if Richard Dennis had written it himself. I sincerely hope Mr. Dennis writes a book before he cannot. Hey Rich, dictate it and let someone else write it. Curtis has some intersting things to say about his feelings on the outcome of the turtle experiment. After narrowing down the field considerably, some could still not follow the rules. Proving that not everyone can trade successfully even after they have been taught a winning system. There is more to trading successfully than just a winning system. Consistency and Discipline are the keys.This book is not like any other trading book I have read. I can think of only one other book that I have read that discusses systems trading with such insight. The main problem with the other book is that a lot of curve fitting, or over optimization, takes place in the discussions of systems development. I'm leaving the name of the other book out because it was written by a guy that did something rather outrageous to show what is possible when trading futures. Even he admits it was possibly the worst thing he did because he gave people the impression that what he did could be repeated often.Back to Way of the Turtle. The chapters on systems developement are going to become legendary. Curtis introduces a couple of "robust" measures that I'm sure will come to be the standard; and possibly open the door for even more robust measures. What he calls R-cubed (a more robust measure of Risk/Reward than the MAR ratio) and RAR% which gives a more Robust Sharpe Ratio. He discusses the merits of system testing, strengths, and most importantly, their limitations. To those who poo-poo backtesting on historical data he poses the question, "what is the alternative?" Know the strengths and weaknesses of backtesting and understand the role of robust statistics and you will be able to develop systems that will perform well in the here-and-now.The sections on cognitive biases are worth the price of the book; and so is the bonus chapter with the Original Turtle Trading Rules. How Curtis connects certain market ideas like support and resistence to the cognitive biases is masterful. Being someone who appreciates mathematics and behavioral finance, I view this book as the first of it's kind. It is not just a book by a former turtle. It is much more than that. The insights are nothing short of genius.Thank You Curtis!

This book provides excellent insight into the trading system that made the Turtles into investing legends. While much of the book centers around technical trade analysis and investor psychology, there are also very interesting segments concerning the day to day activities of the famous investing group. I was impressed that the author didn't use the book as a means to ram his own trading system down our throats. His main point is that each investor should look for a system that is a good match for his or her trading psychology, develop and test that system, and exercise the discipline to follow the system. If you aren't willing to do that, stick with mutual funds or professional money managers.As a person with little skill in complex math, I found myself to be confused every now and then, but not so much as to make this book a waste of time.

Great book with detials of trading journey as well as some insight to how the turtles followed a system to make money in the futures market.