Sometimes it can be very educational to post comments from people that don’t quite get “it”. That said, more from yesterday’s “angry” reader:
“Even more disturbing are the extreme lies in your “approach”. Trend followers use “systems” and “money management” to make money based on momentum. They buy high and hope that there are enough suckers to buy higher. How can you describe that as sound investing? You make it sound like this is some form of intelligent investing. Like there is some rhyme or reason. There are no sound principles behind it. No intelligence. No reason. Just hold and hope and hope you get out before the crowd. Trend following depends on someone else being dumber than you. Buy high and hope someone else buys higher. It is nothing more than that…You sell a crummy irrational approach to investing that is no more successful than most mutual funds. You are no different than the people you bash every day.”
He also added in email to me:
“You don’t even understand the roots of Trend Following. Ask the pros if they believe in an efficient market? They will most likely say that the market is inefficient (how can they beat an efficient market?) and therefore predictable (for trend following to work the market MUST be inefficient). But if the market is inefficient (predictable), then why do your “pros” use a theory/system that relies on unpredictability?”
I understand what he is saying in his first quote above (and yes he has no clue about what he speaks), but can someone decipher the second quote?
Once again, if anyone else out there has this view of trend following trading after reading my book, I would like to hear from you.