Michael goes back in time for a blast to the past and one of his favorite guests.
In this episode of Trend Following Radio:
- Deliberate practice.
Nothing has really changed for me after reading your emails. I basically agree completely with your philosophy.
The cost of your course/online material is not an issue either.
My hesitation is the lack of time that I have to learn your system and actively trade at this time.
I plan to be a more active investor at some point in my life, but am not sure I have the time to invest in the process at this time. I do not want to commit a couple thousand dollars toward an educational process and not be able to give it a reasonable effort.
I practice Emergency Medicine and work the night shift, so I sleep all day and usually am not awake until the markets are closed for the day. I have been slowly reducing my workload and am now only working 160 shifts/year, so I do have several stretches of 3 and 4 weeks off at a time. These are sporadic through the year. My wife and I often are traveling during those times. I’m 65 years old, healthy, and still working full time. 4.5M liquid investment capital divided between accounts at TD Ameritrade, Vanguard, USBank, and the Principle (work 401/457 plans).
How much time would I need to invest to fully understand your program and begin to apply it?
Good questions. Pulled from my FAQs here:
Q: How much time is required to trade as a trend following trader?
A: You can spend a minute or two per market each day. For example, you check prices in the evening, then with one trade in the morning, you place or change any orders in accordance with rules. Flagship trend following trading systems use daily data to determine buy and sell signals. Orders can be placed before the market opens and do not need hourly monitoring. Most top traders manage their trades in 10 to 30 minutes per day. Trend follower Richard Donchian:
“If you trade on a definite trend-following loss limiting-method, you can trade without taking a great deal of time from your regular business day. Since action is taken only when certain evidence is registered, you can spend a minute or two per [market] in the evening checking up on whether action-taking evidence is apparent, and then in one telephone call in the morning place or change any orders in accord with what is indicated. [Furthermore] a definite method, which at all times includes precise criteria for closing out one’s losing trades promptly, avoids…emotionally unnerving indecision.”
Each day you determine entries and or exits for the following day. You can then buy or sell “at the market” on the open the next day.
Just writing to ask for a copy of your slides. Had not heard of you prior to the conference and only had a remote memory of being exposed to trend following as written about in Market Wizards. I feel like my mind is much more open to this trading philosophy, certainly I am ready to adopt a more price oriented approach to trading.
I bought your book and am slowly digesting the contents, there is a lot to digest. Besides the TF content, I really like all the quotes; from von Mises to M Curie… I appreciate that with looming financial market uncertainty trend following could be a very timely and rewarding endeavor..
It seems like you have been on quiet a mission these last 20 or so years; collecting trend following lore, personalities, data, philosophy, history and practice with the intent of furthering your personal understanding and seeking to educate the world. Apparently in the process you have improved the lives of a lot of people. How excellent of you..!
Thanks for having an impact on me. A trip to Saigon is in the mix for us sometime in the not so distant future (it’s important to know something will happen, the when less so), any chance we can look you up or at least seek out some venue suggestions?
Take care and sincere best wishes,
My husband, [Name] and I watched your presentation today with delight, from the comfort of our home in Nova Scotia, through live streaming facilitated by Stansberry Research. Trend following, as a more successful approach to investing, makes a great deal of sense to us. We will order your books to learn as much as possible on the subject; meanwhile may we take you up on your offer to send us references of where to locate the three research papers you indicated as well as the list of momentum ETFs you recommend as well as your PowerPoint presentation?
Many thanks and best wishes for continued success in trend following,
Howard Marks is an investor, writer and author of “Mastering the Market Cycle: Getting the Odds on Your Side.” After working in senior positions at Citibank early in his career, Howard joined The TCW Group, Inc. in 1985. He led groups within the company responsible for investments in distressed debt, high yield bonds, and convertible securities. After 10 years at The TCW Group, Inc. he co-founded Oaktree Capital Management.
Howard got into high yield bonds in August of 1978. This was a turning point in financial history because up until this moment only good companies could borrow money. High yield bonds opened the market to more risky companies and also showed Howard a different way of looking at markets. The first company he worked for had a strategy of buying stock in the 50 most successful companies in hopes they would continue to go up forever. With the advent of the high yield market he saw himself making good and steady money off of the worst/most risky companies–turning everything he had been previously been taught upside down.
Howard has lived through over 50 years of financial history and with his new book he has gone back hundreds of years to examine and study cycles. So how does Howard define a cycle? There are many different cycles–cycles in science, speed, people inhabited, etc. Cycles in the financial world are produced by people and are created by their feelings. The cycle represents a fluctuation in something around a mid-point, but time-frames and reasons for fluctuations do not repeat themselves–except for in human behavior. Looking back hundreds of years there are a few things that are underlying in every financial boom–too much optimism, too much money chasing, and too much risk aversion.
“Reading broadly and voraciously is the best way of learning.” – Howard Marks
“It’s not what you buy, it’s what you pay.” – Howard Marks
I also really enjoyed Ep #689. Where you shoot straight from the hip at the people hating on you for speaking about trend, something that you’ve spent many years of your life learning. Love the passion & the honesty.
PS – It reminds me of the “Man in the Arena” Quote we all love:
“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.“