link:http://www.tradingmarkets.com/.site/stocks/education/bookreviews/bom.cfm?id=157&fullyread=1 "Fleckenstein: The vast majority of the Wizards are discretionary traders, people who regardless of their discipline still include a large dose of human judgment in their decision making. Very few depend on a mechanical systems. Ed Seykota, who was in the first Wizards book, was an exception. Have you found that it's harder to achieve outstanding results with a Black Box vs. a well-disciplined but still discretionary approach? Schwager: Yes. All the Market Wizards have a specific methodology, but most of them do not have systems. There's a reason for that. It's very difficult to develop a trading system that can realize tremendous returns with low risk. There are people who have systems that make a lot of money but have high volatility. Even in the case of Seykota, his phenomenal returns were still achieved with great volatility. When I went out to Nevada to interview him, I remember his pulling out this 15-foot-long graph, showing his equity appreciating from $10,000 up to $15 million. But along the way, it could drop from, say, $6 million down to $3 million. Getting back to the basic question, to come up with a system that has very high return and moderate risk is extremely difficult. Achieving those extraordinary reward-to-risk numbers almost always requires some human element. There are exceptions. Lescarbeau is a systematic trader. His system did achieve what I would have thought was impossible for trading systems: extremely high returns with very low risk. There are also hybrid traders. Someone like David Shaw, who does quant-type arbitrage, has an elaborate, mathematical, computerized approach looking at hundreds if not thousands of inputs. However, this is not what most people think of by trading systems. Cook to some extent is a systematic trader: He has very specific indicators, but he still uses a degree of judgment".