Edward Arthur Seykota was born in 1946 in Holland, but at an early age he emigrated with his family to the United States. His father proved himself a stock trader and finally became the first trading mentor for his son. Ed had his first operation at the age of five in Portland, Oregon. His father gave him a gold medallion, a sales promotional trinket. He sold it to a neighboring boy for five magnifying glasses and it felt like he had participated in a rite of passage. He also began to take an early interest in technical analysis. When I was nine, I had a room full of old radios, test kits and oscilloscopes. Ed liked to generate and show waveforms.
He also noted that long term coverage worked quite well, while transaction costs appeared to reduce systems in the shorter term. This is how the future trading guru was introduced to technical analysis. Ed Seykota began his trading career in the 1970s, when he was hired by a major brokerage firm. It was there that Ed developed one of the first trading systems marketed to manage money in the futures market.
Ed would go on weekends to use the IBM 360/65 mainframe for testing. He drilled the cards and executed batch work on FORTRAN 4. He managed to test four system types on approximately 50 different parameter sets on eight products dating back a decade. This took him half a year. So at 23, Ed Seykota became independent with approximately half a dozen accounts in the range of $10.000-25.000. In the middle of 1988, one of its customer—accounts that began with $5.000, exceeded 250.000 percent in cash. If we normalized by withdrawals, the account would have increased several million percent.