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13 Lessons From the Most Successful Turtle of All-Time with Jerry Parker, The Full Turtle Story – 1of2

"You're sort of tempted after a certain period of under performance to tinker with your systems and call up research. Then as soon as you implement the new research you find out, well the older systems would have performed better"

Imagine you found an advertisement in the newspaper offering a position with a one sentence application process.

Would you take it?

What if it was for a position where you would learn a proprietary trading system in which you would trade solely for owner of the firm?

What if that man was Richard Dennis?

Our next guest took that position in 1983 and it changed his life forever, for the better. He found himself with what was to become a famous title, a Turtle. He was given the opportunity to manage a million dollar account with specific rules to follow. Rules that he would learn to love and perfect.

Thank you for listening and I hope you enjoy the first part of this world exclusive conversation with the most successful Turtle of all times, Jerry Parker.

In This Episode, You'll Learn:

  • About the Turtles and how the unique experiment grew into the Managed Futures/CTA Industry
  • How Wall Street Leaks inspired Jerry into understanding the industry
  • How Jerry encountered trend following for the first time
  • The One Sentence culture in Richard J. Dennis's office

"The Turtle program was so amazing because our client understood trading unlike most clients and actually created those systems. He created the Turtles."

  • How to excel at unprecedented tests from leading traders
  • What it was like moving to Chicago to train as a Turtle
  • What the Turtle training was like and the mindset provided in the training
  • The most challenging thing about Trend Following when Jerry started with Richard Dennis

"I probably trade the original system philosophy as much as humanly possible"

  • About the transition from Turtle Trading to starting his own organization, Chesapeake Capital in 1998
  • The evolution of Chesapeake's strategy from day one after leaving Richard Dennis's program
  • The early focus on diversification and adding new markets
  • Issues with trying to improve the original Richard Dennis
  • The shift in investor expectations with the growth of institutional investment organizations while operating on of the largest CTA firms in the industry
  • Why it's best to take an optimal loss rather than a small loss
  • On the meaningfulness of track records and what else investors should be encouraged to explore when choosing an investment management decision

"Typical Rich (Richard Dennis) he was just very understanding and he just knew how to motivate people. He was a very kind person."

The advertisement Jerry responded to in 1983:

Richard J. Dennis and CD commodities is accepting applications for the position of Commodity Future Trader to expand his established group of traders. Mr. Dennis and his associate 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 will be considered, but is not necessary. Applicants should send a brief resume with one sentence giving their reason for applying.

Resources & Links Mentioned in this Episode:

  • The Barefoot Trader (Article about Richard Dennis in Wall Street Journal)
  • Learn more about Richard J. Dennis the founder of the Turtle program

"I would change in a heartbeat if I could improve, but I just haven't seen anything better than what we were taught. Especially given the fact that I'm always going to error on the side of robust systems, being conservative and not trying to do things to my systems that would weaken their reliability."

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"Bad ideas can work for a long period of time. That's one of the things that Rich told us. If you lose 50% of your money, then you get fired. But he said, 'I'm going to look at all of this based upon how well you're following the rules. If you're making money but not following the rules, you're also going to be fired. If you're losing money and you're following the rules, then that might be ok.' That's sort of the problem with evaluating traders with a small sample size. Bad ideas can seem to work. Any idea that cuts your profit short in the trend following space, eventually is not going to work very well."