Richard Dennis and his Turtle Traders
Imagine a project like "The Star Factory," only it doesn't train show business figures, but rather successful traders. Can you imagine? That's exactly what he did. Richard Dennis back in 1984, without pesky TV cameras, but under the scrutiny of financial circles.
Chicago King of Futures
To the stock exchange Richard Dennis was already attracted at a fairly young age. Not having the right to be on the stock exchange as a minor, Dennis guided his father's actions with the help of gestures. He was a member of the stock exchange, but had little knowledge of trading, so he trusted his son with a more pronounced commercial vein. At the time Richard was working part-time as a bellhop in the trading room, earning America's minimum monthly salary of 40$ at the time, but still spending it entirely on playing the stock market. As he himself later recalled, "I like to repeat that I paid less for my studies than what I learned," meaning that he learned many important lessons from mistakes he made that might have been more fatal had he invested much more heavily in trading.
Become professional trader Richard Dennis decided in 1970 to give up continuing his graduate studies at Tulane University, New Orleans. To this end he borrowed 1600$ from relatives, $1,200 of which went only to reserve a seat on the Central American Stock Exchange. With the remaining $400 Richard took up trading in the commodities market. Who would have known that by the end of the 1980s, the trader's fortune would be worth $200 million!
The basic principles that Richard Dennis adhered to while trading in the commodities exchange were trend following и closing a position in case of destabilizing losses. Thanks to the first postulate, he was constantly ahead of the psychologically less sturdy competitors. The second rule was derived from the case when Dennis, after one mistake, in a desire to win back quickly, in the heat of the moment made two more, thus losing a third of the accumulated capital.
As a result of his success in the soybean market, in 1974 Richard accumulated enough financial resources to become a member of a larger and more prestigious Chicago Chamber of Commerce. Four years later, he began trading from his office to also cover the newly emerging futures markets for currencies, interest rates and gold. Richard Dennis began to gravitate toward technical analysis, developing his own mechanical systems.
23 Traders with Shells or Dennis Turtles
For a long time, the subject of the dispute between Richard Dennis and his old friend, also a famous trader William Eckhardtwas the question of whether the ability to trade was natural or acquired, capable of being taught. Since Richard held the second position and was not satisfied with its theoretical justification alone, the partners concluded the dispute by deciding to find out the correct answer in practice.
To this end, an ad was filed in the Wall Street Journal and the New York Times in 1984, inviting interested people to pass trading training under the leadership of Dennis and Eckhardt. Since these two already had great prestige in the financial world, 1,000 applications were submitted to the Drexel Fund office, of which 13 were selected. The authors of the bet and participants in the program refuse to give the exact criteria for the selection. Only the great diversity of the winners is known: among them there were former traders, professional card players, and even a developer of a computer role-playing game.
By naming the participants of the project "turtles" (during Richard Dennis' trip to Singapore, he saw how thousands of small animals with shells were bred in a vat, which later served as an analogy for novice traders), the partners began to teach them all their secrets and strategies, setting aside two weeks for this. As a result, most of the "turtles" sent to the free float, received an average annual income of about 100%. Impressed by the success, Dennis and Eckhardt organized a second group of 10, repeating the achievements of the first. "The Turtles," like their teachers, are evasive when asked about the essence of learning, repeating only that the secret is self-discipline and following trend. One can only state with certainty who is ultimately the winner in this dispute.
Richard Dennis is known as an outstanding trader and successful manager of his own Drexel Fund, but he too has experienced deep falls, such as in 1987 and the 2000s, after which he left the market twice. Disappointed by the failures and the loss of his clients' trust, Dennis is not trading at the moment, remaining in any case an unquestionable authority among traders.