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Feedback in:

Michael,

Good morning. My situation is the following:

My son is a Junior at the [name]. He recently received a $36,000 loan from the Academy at less than 1% interest. He wants to eventually become a billionaire, and he mentioned investing this loan money in bitcoin. I advised against bitcoin, and suggested that we each invest $36k in foreign currency trading as I used to trade FX and understand those markets better than bitcoin. Our mindset is to double our $72k account each year, and perhaps start a fund after we have a proven 10-year track record. We opened a Forex.com demo account several months ago, and we are planning on going live this week.

I came across the name Richard Dennis while reading the Market Wizards a few months ago. In searching for more information on the Turtle Traders, I came across your book The Complete TurtleTrader. I gifted a copy of your book to my son and a copy to myself for Christmas, and we are both excited about having found a system with a track record of producing the exact type of results we are looking to achieve: doubling our money each year.

So, to your question below about the greatest challenge I am facing tied to my trading, I have three questions:

1) Do you think that it is still realistic to shoot for 100% annual returns using this trend following system in today’s marketplace? A lot of what I read on line states that the turtle method would not work so well anymore. If that’s true, I wonder if that is because it has become a crowded trade with too many people employing the same strategy, or because the markets have been choppier and not as trendy as in the 1980s.

2) Do you think one could find enough diversification needed for this trend-following method by only trading 10 currency pairs on the spot market (as opposed to also trading stocks, bonds and commodities)?

3) What are your thoughts on the best time frame for price breakouts to use in today’s environment, specifically in the FX spot market? You cite the 20-day and 55-day time frames on page 72 of your book, and I wonder if a more optimal time frame has been discovered since or tied to today’s environment. One study I read online last night cited a 200-day price breakout as having achieved far superior results when back testing for a diversified portfolio, as opposed to the 20-day or 55-day. I realize that you might not want to reveal any trade secrets if you have discovered a better time frame, though your willingness to share comes through in your book and so I wanted to pose the question. Any thoughts would be much appreciated.

I thank you for your book The Complete TurtleTrader. It came at the perfect time for my son and me. Chapter 5 is a treasure trove and the ideal resource as we put together our system to trade the 10 currency pairs.

Sincerely,
Name

1. High risk trend following can of course have over 100% returns in a year. Every year? No.

2. FX pairs alone is not enough.

3. Trying to chase one magic entry is not where your energy should be. What about exits? Portfolio selection? Money management? There are many issues. Start here and here.

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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
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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.

Feedback in:

Hi thanks for taking the time to read this. Lets say I draw my trend line and price has been rising for a couple of days off the trend line. How to I decide if I can still take the train? I know for the $ management I reduce the intended 1st buy of my position as my stop is further down than if I bought on the trend line itself. But even if I manage my risk, no point if the odds of the move not working is higher once off the trend line. Might have more questions but lets see if this is not a robot. PS: I don’t YOLO options on margin with reddit, I trade only my cash in equities ( saved me on my 1st big rookie mistake in 2019) I brought 70K to 330K from October 2020 to mid February 2021 (missed most of the rockets of 2020 as I started full time as a trader after 2 years of prep and went threw the finding my identity and trying them all, while not loosing it all) . But after selling at the top in mid February I ended up coming back in and out and going down to 230k. I little of that is explained by switching from swing to position trading as I finally found the style that went with the life style I wanted, so I guess It takes a tole on the account while the wheel starts turning again. My worst drawdown was like 50% in summer 2020 ( I can hear you all the way in Canada saying how did the kid miss out on all of that) I like my volatility….. Anyways really hope this is not a robot; bigger email than planned.

Thanks again
M

Start here to change all of those bad habits.

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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.

Feedback in:

My biggest issues are finding the right stocks at the right time. I use thinkorswim and finviz for scanning and trade entry and occasionally stay in too long (so – I need to improve everything in my trade strategy). I also switch methods on occasion but lately I have been trying to stick to one or two strategies; Scanning for low RSI on daily and then switching to ConnorsRSI 30 min and MFI going up for entry and selecting stocks that are in an uptrend with 21ema pullback to 50sma (TOS scan again) – and 9ema crossing sma (so i guess three strategies). I also have a limited account size and am working my way to building it up from 5000 to eventually “more” to avoid pattern day trade rules (thanks to those jackass’s Barney Frank and Chris Dodd) – I also deposit some of my paycheck in every two weeks).

This does ok but I want to improve without paying for signals or special indicators sold on the internet to “rake in the big bucks” (if this is that, I apologize for wasting your time; I’m not interested).

I have a desire to learn without paying someone a small fortune every month for something that will supposedly do everything for me without applying time and effort researching market conditions and understanding when the opportunity is there. I’d rather deposit that money in my brokerage account. I want to read books, watch videos and learn how to trade better and avoid making stupid mistakes as much as possible.

Thanks for your time,

Sincerely,

Michael

Read my book Trend Following and you will dump your current short term strategy.

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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.

Feedback in:

My biggest challenge in my perpetual quest for a 100% winning strategy is that I am so overwhelmed by online/offline content where everyone is claiming to have the ultimate truth that I can’t know which rule works for which market condition. After reading 40% of the turtle trader book, I am looking forward to interacting more with you,

Best regards,

Name

Make sure to read 100%, then you will stop chasing the dream of 100% winners.

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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.

Feedback in:

Hello,

Thanks for your information.

To give you an answer, it is simply this: where can I find a reasonably good filter for trending stocks?

Regards,

Miguel

It doesn’t work that way. At all.

You need:

• Exact rules for selecting your tracking portfolio.
• Exact rules for entering your trades at the right time.
• Exact rules for exiting your trades with a loss.
• Exact rules for exiting your trades with a profit.
• Exact rules for how much money to bet on each trade.

Also see my FAQS.

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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.

Feedback in:

Greetings Mr. Covel,

I suppose I will test your claim of reading these responses!

I’ve been fascinated with trading pretty much my entire life – it wasn’t until about 3 years ago I had cash I was able to trade with and got into futures. After 3 years of day trading on and off, at the end of each year the story was the same – my account was at a drawdown due to fees and errors, and I had been unable to find an edge that I could apply consistently. I seemed to be able to find intraday opportunities that seemed to work great at certain times and would net me hefty profits, though then would be a disaster and claim whatever I had made the weeks or months prior. Short term techniques with relatively low R of 1 – 1.25 seemed to give me high win rates of 70 – 80% for some weeks/months, but would then drop to 20% – 30% and would wipe everything out. After a relatively large trading sample of the short term day trading strategies I’ve tried over the last three years, everything seems to normalize to randomness, and thus I’ve never found an edge that works consistently. That, and I’ve frankly grown tired of “clicking the mouse” during day trading – I read your book Trend Following and thought it was great, hence why I am here.

So that’s my answer. Have a great day!

Brett

Sounds like you are on the right track. More resources here.

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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.

Feedback in:

Hey Michael,

I read your book 15 years ago or so and loved it. I had a small hedge fund back in 2000 and we did really well by trend following — particularly long Gold and short Bonds at the turn of the century. It was so small I flew it under the radar, but had some very, very happy clients (mostly farmers).

My next fund was a quant fund. I thought I had come up with a mathematical secret sauce for buy and sell signals. I passed the Series 65, hired an attorney and gave him a lot of money, and then started trading with my own money first. The back testing was averaging 35% annual avg ROI. The real life trading was closer to 2% (on a good day). 5000 lines of spreadsheet code later, tens of thousands invested and I folded up the show. I was definitely not going to trade other people’s money without an edge that I knew worked.

I got out of trading for about a decade, then started getting interested in the mathematics of options. I’ve gone fairly deep with [name]. Don is a super sharp guy and really understands options. I’ve learned a ton from him. But so far anyway, the iron condors, and selling high probability spreads, and in/out debit spreads, etc. just haven’t been making me much money. I just don’t see how his strategy can get me where I want to go.

Then a couple of days ago I had a realization, I love commodities and I love trend trading. As I look back on all my trades, I’ve mostly made the really good money following trends. Like last summer buying call options on CL as oil went negative in May… I got in at 25 and sold the calls for roughly 200% gains when crude rallied back above $40. It was a blast.

So I searched on trend trading and saw that you were still out there doing your thing… I got the audio book and am going through it again now. I’m looking forward to going back to the only trading style that has ever really worked consistently for me. Thanks for the re-inspiration!

Paul D

You are welcome!

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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.