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Lessons learned from Ed Seykota
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1. The 3 most important things for a trader are:
(a)The long-term trend,
(b) the current chart pattern
(c) Choosing a good spot to enter
(a)The long-term trend,
(b) the current chart pattern
(c) Choosing a good spot to enter
2. Before you enter a trade, set stops at a point where the set-up invalidates
3. Risk control is related to your willingness to let your stop do its job
4. Speculate with utmost 10% of your liquid net worth.
Risk below 1% of your speculative account on a trade
Risk below 1% of your speculative account on a trade
5. Relying on Indicators is a sign of lack of faith in trend following
6. Ignore advice from other traders, especially those who claim to be never wrong
7. Times during which trend-following systems are highly successful will become popular
8. No trader can follow rules for long unless they reflect his trading strategy
9. If you don’t take a small loss, soon or later you will take a huge loss
10. To handle losing streaks, trim down your activity
11. Keep your bets small and systematically reduce your risk during equity drawdowns
12. The key to good trading is cutting losses
