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Ep. 821: Chris Varelas Interview with Michael Covel on Trend Following Radio

Chris Varelas
Chris Varelas

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Responsible for brokering some of the biggest mergers and acquisitions in finance, Chris Varelas was listed among the top 100 dealmakers by the New York Times and was named top technology rainmaker by DealMakers Monthly magazine. After working as Citi’s head of technology, media, and telecommunications during the first dot-com boom and then leading the company’s national investment bank and regional offices, Varelas left Citi in 2008 to cofound Riverwood Capital, a premier private equity firm in Silicon Valley.

Chris brings a provocative and entertaining voyage into the turbulent heart of modern money that sheds new light on the rise of our threatening and complicated financial system, how money became our adversary, and why finding a new course is crucial to a healthy society.

In the not too distant past, money was simple. You might have had a bank account and a mortgage, perhaps some basic investments. Wall Street didn’t have a reputation for greed and recklessness. That all started to change in the eighties, as our financial systems became increasingly complex, moving beyond the understanding of the general public while impacting our lives in innumerable ways. The financial world began to feel like an enigma—a rogue force working against us, seemingly controlled by no one.

From an industry veteran who’s had firsthand involvement in the events that shaped modern money, How Money Became Dangerous journeys from the crime-ridden LA jewelry district to the cutthroat Salomon Brothers trading floor, from the high-stakes world of investment banking to the center of the technology boom, capturing the key deals, developments, and players that made the financial world what it is today. The book illuminates the dark, hidden forces of Wall Street and how it has dehumanized and left behind everyday Americans. A fresh and enlightening take on how we reached this point, How Money Became Dangerous also makes the case for why Wall Street needs to be saved, if only to save ourselves.

In this episode of Trend Following Radio:

  • How Money Became Dangerous

Mentions & Resources:

“I’ve been listening to your pod casts for a few days now after having discovered your Trend Following book…”

Feedback in:

Hi Michael,

I’ve been listening to your pod casts for a few days now after having discovered your Trend Following book on audible. I’m probably a quarter of the way through the book, so still have a bunch to learn. I just wanted to drop you an email to see if I could get the trend following steps that you mention on your podcast. I’ve just began the process of becoming interested in trading and trying to learn for the last month or two, however until I found your work I had been looking at studying technical analysis which, given your chat doesn’t seem to be the way forward.

I am interested in learning the best and most effective way to become successful at trading but it seems that there is quite a lot of competing ideas and misinformation available to people that are trying to learn. I’d prefer not to put a bunch of time into methods that are pointless, so any information you have on the best way forward would be appreciated.

I recently heard your interview on the IG trading platform, which I’ve signed up to on a demo account to practice before going live maybe next year. I wondered what your thoughts were on their work and what they produce? I understood from your previous podcasts the conversations with your guests that discussion about fundamentals and perhaps technicals is just done for entertainments sake on the mainstream TV and news networks. I wondered if you had a different opinion on IG as you took time to be participate on it. I’m asking as I have been joining their webinars and online academy.

Also I wondered if you think that a trend following strategy can be achieved successfully if starting with a small account? It was my intention to have about £4000 to £5000 available to be ok with potentially loosing I guess, but I got the impression from the discussion on your podcasts that significantly more might be needed in order to be able to stick with a trend/not being stopped out?

Anyway thanks for your time, your podcast is really entertaining by the way and as someone who knows nothing really about trading/finance or business, it’s been really interesting and enjoyable to listen to your work.

Cheers,

Lara

Let me be very direct

Start here.

There here and here and here.

Starting capital? Go here.

Which one of your books would you recommend I start with?

Feedback in:

Mike,

My name is Max F. I am a recent college grad who is at the beginning years of my career as a financial planner. I have, over the past 6 months, started researching futures and derivatives trading. It is becoming a growing passion of mine. Through my deep Google searches, I came across your podcast and have been hooked ever since. The outspokenness in expressing your opinion suits exactly what everyone should look for in a mentor, as there is no beating around the bush. I wanted to thank you for all the time you put into all the podcast episodes and for being a resource for me at these beginning stages. If there is anything I can ever do for you to return the favor please feel free to reach out!

I have not read any of your books yet but plan on doing so after I finish the first Market Wizards book. Which one of your books would you recommend I start with? I was also hoping you could shoot me over the trend following the steps you discuss in the last bit of your podcasts.

I hope to hear from you soon! Have a great Thanksgiving.

Thanks again,

Max

Thanks.

Start with Trend Following fifth edition.

“Does your course teach you what actual statistical triggers you use to statistically to enter a trade…”

Feedback in:

Michael,

Biggest Challenges are as followed:

1.) Identify Trends in FX.
2.) Made improvements in money management but always could improve.
3.) Selling to early, tend to see green and take profits.
4.) Continuation Trades or 2nd trades.
5.) Exit trades.

Thank You

More feedback:

Michael,

I just got done reading “The Rule” by Larry Hite. VERY VERY GOOD READ. Ate it all up.

Just bought your book “Trend Following” and am reading that now. Enjoying that as well very much. Thanks for your work on that!

More feedback:

Does your course teach you what actual statistical triggers you use to statistically to enter a trade (that rocket ship)? In other words can I piggy back on your work and methods? Or do I have to start from scratch and test and backtest my own ideas?

You get the exact rules (triggers) from us you can use tomorrow (entry/exit/bet size/portfolio selection).

Read more.

“I’ve been trying to gather as much information that I can on Trend Following…”

Michael Covel
Michael Covel

Feedback in:

Mike,
Listening to the interview with you and Dan Ferris. He’s such a good interviewer and you’re such a good interviewee. You’re such a good interviewer too, probably one of my favorite but to get someone good at interviewing and he interviews you. I think I finally get you. I might actually be a trend follower after all I just don’t know it yet. Buy and hold is dead. I’m a value investor but not a buy and hold. I’ve got my MACD and my stochastics and moving averages. I hear Baron Rothschild’s quote of the only thing he was guilty of was getting out a little too early. But the inverse is true of getting in just a little late. You can’t time the top and you can’t time the bottom. The thing that really got me with this interview was the 1% positions. It’s the skin in the game concept (which I haven’t read yet). You can’t have those Tesla gains if you don’t get your 1% position. With the 1% (just for example. With the turtles if they got massive upward movement with 1% they might add to that %) I probably won’t mind having a small position or two of non value as long as it seems like it’s trending.
Good show interview again.

Thanks,
Caleb

Thanks!

More feedback in:

Hello Michael,

I just recently first heard about you on the Investor Hour podcast with Dan Ferris. I’ve been trying to gather as much information that I can on Trend Following. I NEED to change everything I’ve ever done with my investing and wanted to get your video on how to get started.

Thanks so much!

Chris

Here you go: My FAQS.