What happens when ordinary people are taught a system to make extraordinary money?Richard Dennis made a fortune on Wall Street by investing according to a few simple rules. Convinced that great trading was a skill that could be taught to anyone, he made a bet with his partner and ran a classified ad in the Wall Street Journal looking for novices to train. His recruits, later known as the Turtles, had anything but traditional Wall Street backgrounds; they included a professional blackjack player, a pianist, and a fantasy game designer. By the time the experiment ended, Dennis had made a hundred million dollars from his Turtles and created one killer Wall Street legend.In The Complete TurtleTrader, Michael W. Covel tells their riveting story with the first ever on-the-record interviews with individual Turtles. He shows how Dennis's rules worked-and can still work today-for any investor with the desire and commitment to learn from one of the greatest investing stories of all time.

Michael W. Covel is the author of the bestselling book Trend Following, now in its seventh printing and translated into eight languages. Covel speaks regularly on the subject of trading and is managing editor of TurtleTrader.com, the leading news and commentary resource on insights into the Turtles. He lives in California.

Preface	p. xi
Acknowledgments	p. xvii
Nuture versus Nature	p. 1
Prince of the Pit	p. 9
The Turtles	p. 29
The Philosophy	p. 51
The Rules	p. 67
In the Womb	p. 99
Who Got What to Trade	p. 113
Game Over	p. 129
Out on Their Own	p. 135
Dennis Comes Back to the Game	p. 145
Seizing Opportunity	p. 153
Failure Is a Choice	p. 167
Second-Generation Turtles	p. 173
Model Greatness	p. 187
Afterword	p. 191
	p. 209
	p. 215
	p. 217
	p. 221
Endnotes	p. 245
Index	p. 257
About the Author	p. 267
Table of Contents provided by Ingram. All Rights Reserved.

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The Complete TurtleTrader
How 23 Novice Investors Became Overnight Millionaires

Chapter One

Nurture versus Nature

"Give me a dozen healthy infants and my own specific world to bring them up in, and I'll guarantee to take any one at random and train him to become any type of specialist I might select—doctor, lawyer, artist, merchant, chef and yes, even beggar and thief, regardless of his talents, penchants, tendencies, abilities, vocations, and race of his ancestors."

John B. Watson,
early twentieth-century American psychologist

In the early 1980s, when Chicago's reigning trader king, Richard Dennis, decided to conduct his real-life social experiment, Wall Street was heating up. The stock market was at the start of a huge bull market. On the world stage, Iraq had invaded Iran. Lotus Development had released Lotus 1-2-3, and Microsoft had put their new word processing program ("Word") on the market. President Reagan, much to the liberally minded Dennis's chagrin, declared it "The Year of the Bible."

In order for Dennis to find his special breed of student guinea pigs, he circumvented conventional recruitment methods. His firm, C&D Commodities, budgeted $15,000 for classified ads in the Wall Street Journal, Barron's, and the International Herald Tribune seeking trainees during late fall 1983 and 1984. Avid job seekers saw this:

Richard J. Dennis
of C&D Commodities
is accepting applications for the position of
Commodity Futures Trader
to expand his established group of traders.

Mr. Dennis and his associates will train a small group of applicants in his proprietary trading concepts. Successful candidates will then trade solely for Mr. Dennis: they will not be allowed to trade futures for themselves or others. Traders will be paid a percentage of their trading profits, and will be allowed a small draw. Prior experience in trading will be considered, but is not necessary. Applicants should send a brief resume with one sentence giving their reasons for applying to:

C&D Commodities
141 W. Jackson, Suite 2313
Chicago, IL 60604
Attn: Dale Dellutri

Applications must be received by October 1, 1984.
No telephone calls will be accepted.

Lost in the back pages of national dailies, the ad attracted surprisingly few respondents when you consider what Dennis was offering. But then, people don't usually expect the road to riches to be in plain sight.

The ad invited anyone to join one of Chicago's most successful trading firms, making "experience" optional. It was as if the Washington Redskins had advertised open positions regardless of age, weight, or football experience.

Perhaps most stunning was that C&D Commodities was going to teach proprietary trading concepts. This was unheard of at the time (and still is today), since great moneymaking trading systems were always kept under lock and key.

Dennis's recruitment process took place long before the chain-reaction flow of Craig's List ads that attract in thousands of résumés within hours for any job. However, it was 1983, and reaching out to touch the world with the flick of a blog post was not yet reality.

Potential students who were ultimately hired recall being stunned. "This can't be what I think it is" was a common refrain. It was, unbelievably, an invitation to learn at the feet of Chicago's greatest living trader and then use his money to trade and take a piece of the profits. One of the greatest educational opportunities of the century garnered responses ranging from a sentence written on a coconut to the mundane "I think I can make money for you." Let's face it, guessing what would make a wealthy, reclusive, and eccentric trader take notice of you in order to get to the next step—a face-to-face interview—had no precedent.

This casting of a wide net was all part of Dennis's plan to resolve his decade-long nature-versus-nurture debate with his partner William Eckhardt. Dennis believed that his ability to trade was not a natural gift. He looked at the markets as being like Monopoly. He saw strategies, rules, odds, and numbers as objective and learnable.

In Dennis's book, everything about the markets was teachable, starting with his very first prerequisite: a proper view of money. He didn't think about money as merely a means to go buy stuff at the mall, the way most people do. He thought of money as a way to keep score. He could just as easily have used pebbles to keep count. His emotional attachment to dollars and cents appeared nonexistent.

Dennis would say, in effect, "If I make $5,000, then I can bet more and potentially make $25,000. And if I make $25,000, I can bet that again to get to $250,000. Once there, I can bet even more and get to a million." He thought in terms of leverage. That was teachable in his book, as well.

On the other hand, William Eckhardt was solidly rooted in the nature camp ("either you're born with trading skills or you're not"). Dennis explained the debate, "My partner Bill has been a friend since high school. We have had philosophical disagreements about everything you could imagine. One of these arguments was whether the skills of a successful trader could be reduced to a set of rules. That was my point of view. Or whether there was something ineffable, mystical, subjective, or intuitive that made someone a good trader. This argument had been going on for a long time, and I guess I was getting a little frustrated with idle speculation. Finally, I said, 'Here is a way we can definitely resolve this argument. Let's hire and train people and see what happens.' He agreed. It was an intellectual experiment."1

Even though Eckhardt did not believe traders could be nurtured, he had faith in the underdog. He knew plenty of multimillionaires who had started trading with inherited wealth and bombed. Eckhardt saw them lose it all because they didn't feel the pain when they were losing: "You're much better off going into the market on a shoestring, feeling that you can't afford to lose. I'd rather bet on somebody starting out with a few thousand dollars than on somebody who came in with millions."2

The Complete TurtleTrader
How 23 Novice Investors Became Overnight Millionaires. Copyright © by Michael Covel. Reprinted by permission of HarperCollins Publishers, Inc. All rights reserved. Available now wherever books are sold.

Excerpted from The Complete TurtleTrader: How 23 Novice Investors Became Overnight Millionaires by Michael W. Covel
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