Way of the Turtle

You remember that movie Trading Places with Eddie Murphy and Dan Akroyd, where these two old millionaires made a bet on nature vs. nurture? This is the true story behind it.

Yes, those two old guys made a bet that they could turn anyone into a successful stock trader, but they did it with a group of 20 people I think (they called them the turtles due to the slow and steady approach to investing I guess). They gave them each either $100,000 or $1M to trade, and gave them a very specific set of rules covering position limits, when to buy, when to sell, etc...

I think just about everyone was successful, but the author of the book, Curtis Faith, was by far the most successful. The book covers his story and provides a lot of detail on his strategy, which gives a lot of insight into systematic trading which today would be based on algorithms. It was interesting to note that this guy was not a professional trader like most of the others, but was in fact a computer programmer (if I remember correctly). He said that the big secret to his success relative to the others was his ability to blindly trust in the rules that were provided and not get greedy or panicked and stretch the defined parameters.

Some of the book is very technical, but I still recommend it highly due to the story line of the time in the turtle program and some amusing annecdotes (particularly regarding table tennis).