2025-08-29
Few stories in financial history capture both imagination and instruction like Curtis Faith's Way of the Turtle. The book is more than a trading manual — it's a journey into a legendary experiment, a study in discipline and psychology, and a practical guide for anyone serious about markets. Faith combines the drama of high-stakes trading with meticulous lessons, making the book both educational and gripping.
In the early 1980s, commodities legend Richard Dennis and his partner William Eckhardt launched an audacious experiment: they would recruit a group of novices, train them to trade, and see if ordinary people could become extraordinary traders. The chosen few would become known as the Turtle Traders.
Curtis Faith, just 19 years old, was among them. He had no formal training, no Wall Street connections — only curiosity, intelligence, and a willingness to learn. Dennis provided the Turtles with a strict rulebook, financial backing, and a clear message: follow the system, or fail.
Way of the Turtle brings this story to life. Faith shares the initial tension, the late nights learning markets, and the pressure of managing substantial capital for the first time. He recounts feeling overwhelmed at times — yet exhilarated when his first successful breakout trade proved that even a novice could profit dramatically if they followed the rules.
At the heart of Way of the Turtle is a structured, trend-following methodology. The system was designed to capture sustained market movements rather than predict them.
Entry Rules: Trades were initiated when a market broke a defined high or low — often a 20-day or 55-day breakout. Faith describes how following these signals required patience; many trades appeared unpromising at first but often evolved into substantial winners.
Position Sizing: The system calculated the amount of capital to risk per trade based on market volatility, using a metric called N (the average true range). This approach prevented catastrophic losses while allowing profitable positions to grow.
Pyramiding Positions: Turtles would add to winning trades incrementally, increasing gains during trends while controlling risk. Faith’s detailed explanations in Way of the Turtle show how even small adjustments could have enormous impacts on returns.
Stop-Loss Discipline: Exiting losing trades quickly was crucial. Faith stresses that consistent application of stops, even when painful, preserved capital and allowed longevity in the markets.
The brilliance of the Turtle system lies in its simplicity: clear rules, systematic execution, and risk management. Yet, as Faith emphasizes, simplicity on paper does not equal ease in practice.
The technical rules were only half the battle. As Faith explains in Way of the Turtle, the real challenge was psychological. Traders faced periods of drawdowns, sudden market reversals, and the constant fear that a single mistake could erase gains.
Emotional Discipline: Faith recounts moments when a position dropped below his entry price. His instinct screamed to exit, but the rules demanded patience. Following the system during these moments separated winners from losers.
Resisting Impulses: Many Turtles failed not because the system was flawed, but because they overrode it, succumbing to fear or greed. Faith highlights how controlling impulses and embracing uncertainty were key to consistent performance.
Long-Term Perspective: Faith stresses that the system is probabilistic. Not every trade wins, but over time, disciplined execution yields predictable results. This mindset — accepting losses as part of the process — is a cornerstone of Way of the Turtle.
By interweaving his personal experiences, Faith makes the reader understand the mental toughness required to succeed in trading, making the book feel alive rather than academic.
While the original Turtle rules were rigid, Faith soon discovered that markets are dynamic and constantly evolving. In Way of the Turtle, he explains how he introduced refinements:
Filtering False Breakouts: Not every breakout leads to a trend. Faith added filters to avoid small, misleading price moves that could trigger losing trades.
Adjusting for Volatility: He modified position sizes and stop distances in particularly volatile markets to protect capital without missing major trends.
Flexible Application: Faith emphasises that while rules form the backbone, flexibility in execution — guided by experience and observation — can enhance profitability.
These adaptations illustrate a key lesson from Way of the Turtle: rigid adherence to rules is critical, but understanding the logic behind them allows a trader to survive and thrive in unpredictable markets.
Although the Turtle experiment focused on commodities and futures, the principles Faith teaches are universal. Way of the Turtle demonstrates how diversification across markets, disciplined risk management, and systematic trend-following can be applied to stocks, forex, and modern cryptocurrency markets.
Faith also shows how technology can amplify the system. Algorithmic trading and backtesting allow traders to apply Turtle principles with greater precision, but the psychological and risk-management foundations remain unchanged. The enduring relevance of Way of the Turtle lies in its combination of clear methodology and human insight — rules are essential, but so is the mindset to follow them.
Ultimately, Way of the Turtle is more than a historical account. It is a roadmap for success under uncertainty. Faith demonstrates that with disciplined execution, careful risk management, and emotional resilience, ordinary individuals can achieve extraordinary results.
The book inspires curiosity and teaches practical skills: how to identify trends, size positions, manage risk, and most importantly, master the psychology of trading. Decades after the original Turtle experiment, Curtis Faith's lessons remain powerful and actionable.
For anyone seeking to navigate the uncertainty of financial markets, Way of the Turtle is not merely a guide — it is a blueprint for thinking like a trader, acting with discipline, and thriving when others fail.
Disclaimer: This material is for general information purposes only and is not intended as (and should not be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by EBC or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
