Don’t Call Me a Loser

Feedback in from last night:

Hi Michael, I have been a subscriber to your newsletter and have read your book. I understand there are many great trend followers in the past and will have many more in the future. However, I find your complete dismissal of other systems a little disturbing. I have read a few cases, where you have labeled readers who question trend following as losers or otherwise. Has it occurred to you that there may be more than one way to do things? While you cite the various trend followers as proof that trend following works — fine, it does. But at the same time, you can’t completely ignore the successes of others that do not use trend following.

Clearly, Warrren Buffett is not a loser, but he is my opinion the ultimate unrepeatable outlier. And my use of the term “loser” has been to describe market “losers” as in losing money. There are winners and there are losers. Should we not talk about losing situations like the LTCM crisis? Or should people who buy and hold no matter what, making less money than trend following, be excused from criticism? Given the fact that most people have still never heard of trend following and that most academics still say it doesn’t really work, your email feels like a compliment.