Who is Ed Seykota?
Ed Seykota was born in 1946 and studied electrical engineering at MIT. He discovered financial markets early and became one of the first traders to use computers for systematic trading – in the 1970s when that was still pioneering work.
Jack Schwager interviewed him for Market Wizards Vol. 1 (1989) and described him as one of the most extraordinary traders he had ever met. Not because of his profits – but because of the depth of his understanding of markets and himself.
Seykota later founded the Trading Tribe – a community that combines emotional work with trading psychology. The core principle: Emotions are not disturbances – they are information that must be understood.
Seykota's core quotes – with explanation
“If you can’t measure it, you probably can’t manage it. Things you measure tend to improve.”
This is Seykota's fundamental principle – applied to himself. He didn't just document trades and prices. He documented his own behavior, his decisions, his patterns. What is visible can be changed. What remains invisible repeats itself.
“Trying to trade during a losing streak is emotionally devastating. Trying to play catch-up is lethal.”
Revenge Trading
Seykota describes revenge trading with a clarity no scientist could formulate more precisely. And his solution: Stop. Don't continue. Pause. Reset.
“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.”
That's uncomfortable. But Seykota means it: Those who keep making the same mistakes without analyzing them may have an unconscious reason for doing so. The journal reveals it – whether you want to hear it or not.
“Psychology motivates the quality of analysis and puts it to use. Psychology is the driver and analysis is the road map.”
“The elements of good trading are: cutting losses, cutting losses, and cutting losses.”
What Seykota said about journaling
Seykota was one of the first traders to systematically document everything. His logic: Without measurement, no improvement. He treated his own trading like a scientific experiment – with hypotheses, data, and conclusions.
Seykota's fundamental principle
His most famous principle: “If you can’t measure it, you probably can’t manage it.” Applied to emotions, this means: If you don't document and analyze your emotions – you can't manage them.
Frequently Asked Questions
What is Ed Seykota's trading strategy?
Seykota is a trend follower. He trades systematically according to predefined rules, uses trailing stops, and lets winners run while consistently cutting losses. His approach is disciplined, mechanical, and emotionally detached – made possible by years of self-analysis and a clear system.
What is Ed Seykota's Trading Tribe?
The Trading Tribe is a group process method that Seykota developed to help traders understand their emotional blocks. Core principle: Emotions are not to be suppressed – they are to be understood. Those who understand why they react emotionally in certain situations can manage those reactions.
What can futures traders learn from Ed Seykota?
Three things: 1) Document everything – trades, decisions, emotions. 2) Stop when you're emotional – no revenge trading. 3) Cutting losses is the most important thing – no stop-loss shifting.
The Seykota principle in your daily routine
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