Author: Michael Covel

“I don’t want to have to worry about the market every minute. I want models that will make money while I sleep. A pure system without humans interfering.”

That is Jim Simons. Not a blogger. Not a guru with a seminar to sell. The mathematician who ran Renaissance Technologies, whose Medallion fund returned something close to 66 percent a year before fees for three decades. Nobody in the history of markets has come near that record. And here is the man at the top of the mountain telling you what he actually wanted. Not a hot tip. Not a forecast. A system that runs without him in the room.

Read it again, because the financial press will never frame it for you this way. The greatest trader who ever lived did not want to watch the screen. He did not trust his gut. He did not trust anyone’s gut, his own included. He wanted the human taken out of the machine.

It did not start that way. Early on, Simons traded the way everyone tells you to trade. Fundamentals, newspapers, instinct, gut calls. It worked some of the time and it wrecked him the rest of the time. The swings left him sick to his stomach. Win and you feel like a genius. Lose and you feel like a fool. He decided he was finished living on that rollercoaster, and he went looking for something that could not panic, could not get greedy, and could not talk itself out of a winning position at the worst possible moment.

So he built it. Then he protected it with one hard rule at Renaissance: never override the computer. Sit with that. The smartest man in the building was not allowed to use his own judgment in the moment. Why? Because they had the data, and the data said that when humans reach in to fix the system, they tend to make it worse. Even Simons.

Now look at what the rest of the industry sells. The brilliant call. The manager who saw it coming. The face on television who knows what happens next. It is theater, and it always was. The man who solved the market spent his life and a good piece of his fortune engineering that exact theater out of his process.

Here is what I want you to take from a man who lapped the entire field. You do not need to be Jim Simons. You do not need a building full of physicists. But you can borrow the one idea that made him: the enemy is not the market. The enemy is the human in the chair. Your fear sells the bottom. Your greed buys the top. Your need to be right makes you nurse the losers and dump the winners. A rules-based system does none of that. It follows the plan while you sleep.

Stop interfering. Build the rules, then get out of their way.

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How can you move forward immediately to Trend Following profits? My books and my Flagship Course and Systems are trusted options by clients in 70+ countries.

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Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.

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Please enjoy my monologue It’s Never the New New Thing with Michael Covel on Trend Following Radio.

Jerry Parker posted something this week that made me laugh, and Jerry does not waste words. He was one of Richard Dennis’s original Turtles. He has run Chesapeake Capital for decades on a single idea: systematic Trend Following. So when Jerry points at the so-called experts, he is pointing from inside the arena, not from the cheap seats.

Here is what he saw. A whole crowd of experts trash systematic Trend Following in public. Then they turn around and write books telling investors to do this:

Diversify. Respect price. Follow trends. React instead of anticipate. Stay flexible and adapt when the market changes. Stop deciding a market is too high or too low. Accept that trying to call tops and bottoms means missing the biggest moves. Cut losses. Let profits run. Focus on the size of your winners, not how often you are right. Manage risk without mercy.

Read that list again.

That is not a critique of Trend Following. That is the definition of Trend Following. Word for word. Every line on that page is something a trend follower has been doing since the first market opened. The experts did not discover a better way. They described our way and slapped a different cover on the book.

So why the act? Why trash the method in one breath and teach it in the next?

Because saying it out loud costs them something. The prediction business is a good business. Telling people you know where oil goes next quarter sells newsletters, fills seminar rooms, and gets you back on television. “Follow the trend and control your risk” makes a poor headline. It is too plain. It does not flatter the guru and it does not flatter the crowd. Nobody wants to pay for permission to stop guessing.

There is ego in it too. To call it Trend Following is to admit you do not know the future. That is a hard thing for a man who built a career pretending he does. Easier to mock the name, borrow the rules, and hope nobody notices the contradiction. Jerry noticed.

Here is the part I want you to keep. Do not get dragged into the fight over the label. Let them call it whatever they want. While they argue about the name, you do the work. You diversify. You respect price. You cut the loser the moment it proves you wrong, and you sit on your hands while the winner runs. You stop asking whether the market is too high. You react to what price is doing instead of betting on what you wish it would do.

The experts already wrote down the answer. They just refuse to say the two words. You do not have that problem.

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How can you move forward immediately to Trend Following profits? My books and my Flagship Course and Systems are trusted options by clients in 70+ countries.

Also jump in:

• Trend Following Podcast Guests
• Frequently Asked Questions
• Performance
• Research
• Markets to Trade
• Crisis Times
• Trading Technology
• About Us

Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.

Subscribe to Trend Following Radio on iTunes

My guest today is Michael Melissinos. He is the founder of Melissinos Trading and a trend following trader influenced by legendary traders Ed Seykota and Jerry Parker. A former college baseball player and Bear Stearns employee, he is known for his disciplined, rules-based approach to trading.

The topic is Trend Following.

In this episode of Trend Following Radio we discuss:

• Finding and profiling exceptional traders across generations
• Timeless trading principles and trader personality traits
• Verification and due diligence of trading performance
• Market evolution, adaptation, and competitive edge
• Unconventional trader journeys and paths to success

Mentions & Resources:

• Michael Melissinos on LinkedIn
• Michael Melissinos on X
• Melisinos Trading

Listen to this episode:

• Listen to this podcast on iTunes. (Please leave a rating!)
• Listen on Spotify.
• Libysn RSS.
• Download as MP3 by right-clicking here and choosing “save as.”
• Free Video.

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Feedback in:

Hi Michael,

Thank you for sharing your story. It resonates with me because, like many traders, I wasn’t looking for shortcuts—I was looking for consistency.

My biggest challenge has been achieving consistent profitability despite years of studying the markets, testing strategies, and refining my approach. I’ve traded forex, gold, silver, Bitcoin, and futures, and while I have developed discipline and patience, translating that into steady returns has remained elusive.

Over time, I’ve realized that prediction is a losing game and that risk management and systematic execution matter far more than opinions. That’s what drew me toward trend following and rule-based trading in the first place.

I’m always searching for ways to simplify my process, remove emotional decision-making, and build a methodology that can survive the inevitable uncertainty of the markets.

I appreciate the work you’ve done documenting the Turtle Traders and look forward to learning more from your perspective.

Best regards,
Gabriel K.

You are welcome.

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Welcome!

How can you move forward immediately to Trend Following profits? My books and my Flagship Course and Systems are trusted options by clients in 70+ countries.

Also jump in:

• Trend Following Podcast Guests
• Frequently Asked Questions
• Performance
• Research
• Markets to Trade
• Crisis Times
• Trading Technology
• About Us

Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.

Feedback in:

Hello Michael,

Thank you for your email and for sharing your work on Trend Following. I have been studying trading for some time, and your approach has caught my attention because of its focus on discipline, risk management, and following price rather than predictions.

I am very interested in joining one of your training programs. However, I have one concern: my English is limited, and I am worried that I may not be able to fully benefit from the course materials.

Could you please let me know if any of your courses include:
Subtitles or captions for the videos?
Translation support for non-English speakers?
Written transcripts that can be translated?
Any students who have successfully completed the program using translation tools?

I would also like to briefly share my biggest trading challenges. My entries are often good, especially when trading SPX after confirmed breakouts. However, I tend to take profits too quickly, then regret exiting, re-enter the trade due to fear of missing out (FOMO), and end up losing money. Developing better discipline and trade management is one of the main reasons I am considering your training.

I would appreciate any guidance you can provide.

Thank you for your time.

Best regards,
Fatimah

My products are currently in English. I don’t have support for languages beyond English. So this comes down to translation tools–of which there are many. Do you use those tools now? Your email is very clear.

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Welcome!

How can you move forward immediately to Trend Following profits? My books and my Flagship Course and Systems are trusted options by clients in 70+ countries.

Also jump in:

• Trend Following Podcast Guests
• Frequently Asked Questions
• Performance
• Research
• Markets to Trade
• Crisis Times
• Trading Technology
• About Us

Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.

Steve Burns posted a picture the other day. Three circles, overlapping. I have stared at ten thousand charts in my life and this little drawing said more than most of them.

Circle one: Winning System.
Circle two: Risk Management.
Circle three: Psychology.
Where all three meet, dead center, one word. Profitable.

Now look at what happens the moment you are missing a piece. System and psychology with no risk control, you blow up. System and risk control with no head for the game, no discipline. Psychology and risk control with no system, no edge. The center is small. The ways to stand outside it are everywhere.

Here is the uncomfortable part. Most people spend an entire trading life camped on the edges and never once stand in the middle. Not because the middle is hard to grasp. Because the middle is quiet and the edges are loud. The edges are where the forecasters live. The next call. The next hot take. The guru who swears he knows where the market closes on Friday. None of that noise builds a single one of those three circles.

Burns laid out the five things that pulled him into the center after the dotcom bust wiped out the easy money. I read it and nodded the whole way through. So let me give you my version.

Get an edge before you risk a dime. If you trade with no system and random entries, you are not trading. You are donating. Luck runs out. Know how you make money, or accept that you are the one feeding the table.

Risk management beats every indicator you own. New traders collect indicators like baseball cards. It does not matter. You will have losing trades and losing streaks no matter what is on the screen. Position sizing and stops are what keep you alive long enough to be right. Survival first. Everything else second.

Trade with the trend, not against it. The larger Trend Following move decides your fate more than any opinion you hold. Buy the dip in a downtrend and you bleed. Buy breakouts in a dead range and you bleed. Short an uptrend and you bleed. The path of least resistance runs in the direction of the trend. Fighting it is the most expensive habit in this business.

Care about the size of your wins, not how often you win. Win rate is vanity. A pile of small losses and a handful of enormous winners is the whole game. Be wrong small. Be right big. Cut the losers the moment price tells you the trade is wrong, and let the winners run on a trailing stop until they are done. That asymmetry is the thing. Not prediction. Asymmetry.

Price is the only thing that pays. Fundamentals can tell you what to put on the watchlist. They will never tell you when. A great company in a downtrend still takes your money. Only price tells you when to act, which side to take, and when to leave. The best trades are the ones where the story and the price agree.

Five points. Three circles. Print the picture and tape it to the edge of your screen. Every trade you will ever consider lives somewhere on that diagram. Your only job is to keep dragging yourself back to the center while the rest of the world screams from the edges.

Steve gets the credit for the drawing and the list. I am just the guy telling you he is right.

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How can you move forward immediately to Trend Following profits? My books and my Flagship Course and Systems are trusted options by clients in 70+ countries.

Also jump in:

• Trend Following Podcast Guests
• Frequently Asked Questions
• Performance
• Research
• Markets to Trade
• Crisis Times
• Trading Technology
• About Us

Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.