My guest today is Tim Koller, a partner in McKinsey’s Stamford, Connecticut office, where he leads a global team of corporate-finance expert consultants. Tim has served clients globally on corporate strategy and capital markets, mergers and acquisitions transactions, and strategic planning and resource allocation. For over 90 years, McKinsey & Company has helped corporations and organizations make substantial and lasting improvements in their performance. Through seven editions and 30 years, Valuation: Measuring and Managing the Value of Companies, has served as the definitive reference for finance professionals, including investment bankers, financial analysts, CFOs and corporate managers, venture capitalists, and students and instructors in all areas of finance.
The topic is his book Valuation: Measuring and Managing the Value of Companies.
In this episode of Trend Following Radio we discuss:
Recession and Recovery
The first half of 2020
Government Debt
Valuation: Measuring and Managing the Value of Companies 1st Edition
Gimme Danger with Michael Covel on Trend Following Radio
Please enjoy my monologue Gimme Danger with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive.
My guest today is Milton Friedman, one of Michael’s favorite dead guests to bring on the podcast. Milton foreshadows Uber, talks about the deep state (without mentioning the deep state), brings up airline service and monopoly. His solutions to problems in government 35 years ago were to cut government spending, hold monetary growth back and cut regulations. The same solutions to government are at the forefront of American politics today. Today, Michael curates two interviews between Phil Donahue and Milton Friedman. These interviews were recorded back in the 1980’s, but many of the points made are more relevant today than ever.
The topic is airline service and monopoly.
In this episode of Trend Following Radio:
Government spending
Liberty in trading
Government regulation
Unknowingly supporting private interests
How to prevent monopoly
Legalizing drugs
Prohibition
“I don’t believe government is the mother of children, I don’t believe it is the father of children, I believe government is a way in which you and I and our fellow citizens achieve certain things jointly that we can’t achieve separately.” – Milton Friedman
“The private market system is a system of profit and loss. And the loss part is just as essential as the profit part.” – Milton Friedman
Please enjoy my monologue Stepping Aside with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive.
In this episode of Trend Following Radio:
Meritocracy
Donald Trump as President
Trading off the trend, not fundamentals
“They said the market would crash if Trump won, and the market didn’t. But who are ‘they’? That should be the question.” – Michael Covel
Please enjoy my monologue No Charts, Trade the Price with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive.
In this episode of Trend Following Radio:
Why cultivating your second string is so important
Foreign players vs. U.S players
Accountability
Importance of honesty
Having the same standards for everyone
Importance of humility
Execution
A different perspective on goal setting
Looking at the big picture
“It’s a journey. It’s a process. It’s difficult. The joy is in the process. The joy isn’t in the final culmination. That fades away pretty quick… The journey is what you are most proud of.” – Gregg Popovich
My guest today is Steve Kamb, the founder of Nerd Fitness and leader of this rag-tag group of misfits. He is an American fitness instructor, publisher and writer best known for promoting health and wellness at the website and fitness center NerdFitness.com.
The topic is his book Level Up Your Life: How to Unlock Adventure and Happiness by Becoming the Hero of Your Own Story.
In this episode of Trend Following Radio we discuss:
Traveling domestic and internationally
The hero’s journey
Marketing yourself
Marketing to a niche
What is a nerd?
Tailoring your fitness needs
“Surround yourself with people that are challenging you and making you better.” – Steve Kamb
“Life is meant to be lived on your own terms.” – Michael Covel
[Trend Following] fills a void in a marketplace inundated with books about buying low and selling high, index investing, and all other types of fundamental analysis, but lacking any resource or, for that matter, practically any reference to what I believe is the single best strategy to consistently make money in the markets. That strategy is known as trend following. Author Van Tharp has described it succinctly:
“Let’s break down the term ‘trend following’ into its components. The first part is ‘trend.’ Every trader needs a trend to make money. If you think about it, no matter what the technique, if there is not a trend after you buy, then you will not be able to sell at higher prices … ‘following’ is the next part of the term. We use this word because trend followers always wait for the trend to shift first, then ‘follow’ it.”
Trend following trading seeks to capture the majority of a market trend, up or down, for profit. It aims for profits in all major asset classes—stocks, bonds, currencies, and commodities. Unfortunately, however simple the basic concepts about trend following are, they have been widely misunderstood by the public. My desire to correct this state of affairs is what, in part, launched my research. I wanted to be as objective as possible, so I based my writing on all available data:
• Trend followers’ published words and comments over the last 30 years
• News accounts of financial disasters
• News accounts of the losers in those financial disasters
• Charts of markets traded by trend followers
• Charts of markets traded by losers in the financial disasters
If I could have written books comprising only numbers, charts, and graphs of trend following performance data, I would have. However, without any explanation, few readers would have appreciated the ramifications of what the data alone showed. Therefore, my approach to writing Trend Following became similar to the one Jim Collins describes in his book Good to Great, in which a team of researchers generated questions, accumulated data in their open-ended search for answers, and then energetically debated it.
However, unlike Collins who was writing about generally well known public companies, trend followers form a sort of underground network of relatively unknown traders who, except for an occasional article, the mainstream press has virtually ignored. What I have attempted to do is lift the veil, for the first time, on who these enormously successful traders are, how they trade, and what is to be learned from their approach to trading that we might all apply to our own portfolios.
Trend Following challenges much of the conventional wisdom about successful trading and traders. To avoid the influences of conventional wisdom, I was determined to avoid being influenced by institutionalized knowledge defined by Wall Street and was adamant about fighting “flat earth” thinking. During my research, starting with an assumption and then finding data to support it was avoided. Instead, questions were asked and then, objectively, doggedly, and slowly, answers were revealed.
If there was one factor that motivated me to work in this manner, it was simple curiosity. The more I uncovered about trend followers, the more I wanted to know.
—
Feedback from a listener:
Hi Michael.
I’ve been listening to your awesome podcast for a few months now and it has intrigued me quite a lot. Thank you so much for putting it up out there.
I never really thought about money before. I’m one of those suckers who has been keeping the money in the bank, too skeptical of financial advisers, too afraid and ignorant of the stock markets. At some point obviously I started to realize that I needed to be in control of my savings and start planning my future. I’ve been reading a lot about the markets, but nothing makes as much sense as your words.
Despite understanding your message (at least I think I do), I actually don’t know how to exactly implement that way of thinking on a personal strategy. I am a dentist living in London, 2 small kids at home, so not a lot of time on my hands. I have been putting some of my savings on a buy and hold strategy with Vanguard equity funds. But without a doubt I am dependent on market timings and on the hope things will always “get better.” And that doesn’t seem to be very sensible.
So, I am contacting you in the hope you could help me to have some more clues on how to start on a trend following strategy that could fit my circumstances.
With great admiration,
[Name]
My father is a dentist. I feel a kinship! Good news and bad news: Good? Trend following can help anyone. Bad? Need to do some prep. Here are some starters: Start Now and an Intro Video.
