"Exclusive Interview with Nick Stott, creator of the Camarilla Equation
camarilla. cam·a·ril·la. A group of confidential, often scheming advisers; a cabal.[Spanish, diminutive of cámara, room, from Late Latin camera. See chamber.]

Nick Stott is a tall, unassuming gentleman, of middle years, and the tasteful trappings of a man who enjoys success, but has not let it go to his head. We tracked Nick Stott down to an exclusive bar in the fashionable district in which he lives with his wife and children. Nick granted us a few minutes out of his busy schedule to talk about the Camarilla Equation and how he discovered it.

CE: So Nick, how did you come to invent the Camarilla Equation?

Nick Stott: Basically, it sprang from my interest in Fibbonacci levels. I was working as a bond trader back in the 80's, and started to notice that there were regular patterns emerging every day, differing only in scale. In the evenings at home, I managed to gather enough data to produce a statistical model of what was happening. Although Fibbos are actually (in my opinion of course!) rather unreliable until after the event, they did lead me to notice something else, something much more interesting in fact. Many long nights later, it all fell into place, and it was then fairly simple to reduce it down to a calculation that mapped nicely onto the factual data. I must admit to being surprised at how good and consistent it was, especially across many different instruments. It doesn't require any paramaterisation, and works as well on a liquid stock as on a soyabean futures contract. In my eyes, it's almost like the 'golden mean' of trading.

CE: Sorry, what's the 'Golden Mean'?

Nick Stott: Ah. Since classical times, builders have used a ratio of height to width that is essentially... pleasing to the eye. The Camarilla Equation works in pretty much the same way - it is all about believability - at what point will the majority of traders stop believing it can continue the move, and close their trades, causing a reversal...After all, everybody is watching the same chart! (Note - Nick Stott had a classical education at a top flight school)

CE: I see. Do you sell the equation?

Nick Stott: I'm a busy man, so I don't have time to promote or market the Camarilla Equation. But I have licensed it to a company who run http://www.surefirething.com, and they sell an online version. Works well for both parties, I feel.

CE: Have you licensed it anywhere else?

Nick Stott: No. Why would I? I'm aware that other companies or people attempt to sell 'versions' of my equation, but I really can't be bothered to chase them up. Their versions don't work as well as the real deal, I'm told. Caveat Emptor, I'd say!

CE: Excuse me?

Nick Stott: Caveat Emptor - Its Latin. "Let the buyer beware"

CE: OK! Point taken. One final question - why did you call it the 'Camarilla Equation'?

Nick Stott: Ha! Everyone asks me that. When I first started trading, I thought (as a lot of people do!) that the markets were controlled by a secret 'insiders club' of powerful organisations who manipulated prices for their own benefit. I remember that at the time I was smugly sure that this was so, and was excited to be joining (as I then thought!) this secret 'cabal'. Of course, as I learned more about the markets, I realised that this was nonsense, and that the markets are far too big to be effectively controlled, even by gigantic financial corporations. However, it still looked to me as though there was a pattern in what was supposed to be the 'random walk', a pattern that matched very closely what I imagined a 'secret society' would try to implement in order to maximise their revenues. The obvious conclusion, of course is that if you have enough participants, statistically they start to behave in broadly predictable 'over-ways', and this leads to the patterning that the equation is so good at predicting. The word 'Camarilla' is based on the latin word for room (camera), and it means basically a small clique of 'advisors' who try to manipulate the person in power for their own ends. Frankly, it was just a joke, and I am always surprised at how seriously everyone took it. Happy?

CE: Yes. Thanks for your time, Nick, and nice meeting you.

Nick Stott: You're welcome, old chap".