Ed Seykota facts for kids

Edward Arthur Seykota, born on August 7, 1946, is a very successful trader who works with financial markets. He is famous for being one of the first people to use computers to help him make trading decisions. He earned degrees in Electrical Engineering and Management from the famous MIT in 1969.

In 1970, Seykota was a pioneer in using early computers to test his ideas for trading in the markets. He used punched card computers for this new way of trading. He used to live near Lake Tahoe in Nevada but later moved to Texas.

Edward Seykota's Career

When he was younger, Edward Seykota went to high school near The Hague in the Netherlands. He also lived in a town called Voorburg.

Pioneering Computer Trading

In 1970, Seykota created a special computer system for trading in the futures market. He developed this system for the company where he and another trader, Michael Marcus, worked. Later, he decided to start his own business. He began managing money for some of his clients on his own.

Much of Seykota's success came from developing and using these computer trading systems. He first tested his ideas on a large IBM mainframe computer. The company he worked for later started using his system for their own trades.

Inspiration for Trading Systems

Seykota became very interested in creating a computer system after reading a letter by Richard Donchian. Donchian wrote about using mechanical systems to follow market trends. He also had systems based on 5-day and 20-day moving averages.

Another book that inspired Seykota was Reminiscences of a Stock Operator by Edwin Lefèvre. Seykota based his very first trading system on something called "exponential moving averages."

Seykota believed that trading systems do not need to be changed often. He said that the most important thing is for a trader to find a system that fits their own style.

He kept improving his system over time. He made it better to match his own trading style and what he preferred. At first, his system was very strict. But later, he added more rules, ways to spot patterns, and methods for managing money.

Edward Seykota's success also came from his true love for trading. He always had a positive attitude. These things helped him keep working to make his system better. He focused on fine-tuning how the system reacted to market changes.

The Trading Tribe

In 1992, Edward Seykota started a group for traders. He was concerned that traders often let their feelings get in the way of their logical decisions. This group began meeting regularly. Seykota developed special ways to help people grow personally.

Over the years, this group grew. It now includes "Tribes" all over the world. People from many different jobs are part of it. Members of the group helped create a set of practices. Seykota calls these practices TTP, which stands for the Trading Tribe Process. He wrote about these ideas in his book The Trading Tribe (2005). He also refined these ideas in an online article from 2013.

Books by Edward Seykota

• The Trading Tribe (2005)
• Govopoly in the 39th Day (2013)

Edward Seykota's Influence

In the book Market Wizards, Updated: Interviews With Top Traders, the author Jack D. Schwager dedicated a whole chapter to Edward Seykota. Schwager wrote that Seykota's achievements show he is one of the best traders of our time.