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Category: Trend Following

Long Term Capital Management; Never Goes Out of Style!

Posted on by Michael Covel

Feedback in:

Hi Michael, I am a trend-follower from Norway (the cold country in Europe!), for about 5 years. I just wanted to thank you for all the great information and books you are writing/providing. I have been trading the markets for about 10 years, but the first 5 years with losses. After the first 5 yrs, I sat down and did a great job of analyzing my mistakes, and with Amazon’s help, I found books that led me in the right direction (Starting with Reminiscences of a Stock Operator). I recommend this video [see video below] about LTCM. Very interesting. (related to risk management and black swan events). Thanks again.
Best regards,
Niels

Thanks! If you have not watched it–watch now.

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.

Ep. 111: Nick Radge Interview with Michael Covel on Trend Following Radio

Posted on by Michael Covel
Nick Radge
Nick Radge

My guest today is Nick Radge. Radge operates The Chartist (www.thechartist.com.au). He began trading in 1985. During a stint working for an investment bank in Singapore Nick dedicated his evenings testing trading strategies; 2 hours a day for 18 months, a total of at least 750 hours. Nick’s first book, Every-Day Traders (John Wiley & Sons Australia Ltd, 2003), was written to identify the traits of successful traders.

The topic is his book Unholy Grails – A New Road to Wealth.

In this episode of Trend Following Radio we discuss:

  • How the trend following world is foreign to many people
  • The importance of drawing distinctions between traditional value investing and alternative systems like trend following
  • How the name of the game for many fund managers is not necessarily performance but funds under management
  • Playing the game of mathematics vs. playing the game of picking the right stocks
  • Why the US stock market has gone straight up despite all the fear going on elsewhere in the world, and why you shouldn’t “fight the tape”
  • Closet trend followers
  • Why price can’t be faked
  • Trade restrictions, cultural attitudes, and the importance of being able to step out of the crowd
  • Why individuals have an advantage over fund managers
  • The value of understanding trend following even when you don’t actually use it as a strategy
  • Spotting ‘trends’, how you can’t spot a trend until it’s started or until it’s over, and using hitchhiking as an analogy for trading
  • How trend following is useful when outlier events and black swans appear
  • Using rules and strategies to fight fear
  • The difficulty of using Warren Buffett as an example, and the problems that arise when managing larger amounts of money
  • Radge’s thoughts on being an entrepreneur

Listen to this episode:

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You Don’t Have Inside Access, But Some Do; What Will You Do?

Posted on by Michael Covel

Take a read of PDF exhibits from the March 15, 2013 Hearing: JPMorgan Chase Whale Trades (A Case History of Derivatives Risks & Abuses).

Bottom line?

You don’t have access to the power reigns.
You don’t have a hotline to politicians.
You will not be bailed out.
You can’t believe anything you read and all fundamentals can be “cooked”.

What are your options?

Trade the one variable they can’t fix or fake: the price.

That’s the trend following way.

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.

Passing of Elizabeth Cheval the Founder and Chairman of EMC Capital Management

Posted on by Michael Covel

Sad news:

It is with great sadness that I report to you the passing of Elizabeth Cheval, the Founder and Chairman of EMC Capital Management. Liz was highly regarded by her peers throughout the managed futures community and recognized as one of the leaders of the industry from its earliest stages.
John C. Krautsack
Managing Director
EMC Capital Management, Inc.

A legendary trader from the Turtles.

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.

Ep. 107: Be Water My Friend with Michael Covel on Trend Following Radio

Posted on by Michael Covel
Be Water My Friend with Michael Covel on Trend Following Radio
Be Water My Friend with Michael Covel on Trend Following Radio

Please enjoy my monologue Be Water My Friend with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive.

Listen to this episode:

Want to learn more Trend Following? Watch my video here.

Authority v. Tradition Is Central to Your Speculative Decisions

Posted on by Michael Covel

“Because we’ve always done it that way.”

Those are the words of someone likely to lose big–soon. Authority is not a wise foundation for speculative moneymaking decisions. Consider:

Appeal to authority is bad, but appeal to tradition is even worse. Experts aren’t infallible, but at least expertise is usually hard-won and retains some applicability over time. By contrast, tradition is often totally arbitrary or based on reasons that retain no relevance whatsoever. Also, an expert can issue a correction but tradition remains immutable and sacred (source: Jeff Darcy).

I would argue that almost all fundamental style investing falls into a category of tradition. Very few look for an alternative such as trend following. They figure that since it appears that everyone has invested or traded a certain way–that it must be the only way. They forget to dig deeper and forget to look for the truth behind why investing/trading works. Always searching for the “why?” is part of my February 25th presentation in Tokyo.

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.

Going The Extra Mile and Trend Following

Posted on by Michael Covel

Do you really want to be in a box with millions of traders and investors with the same training, technique and style (i.e. fundamentals, forecasts, buy and hold, talking heads, etc.)? Richard Dennis danced to a different beat and his creation of the Turtles landed him in the hall of fame. Dennis relayed one of his quirks that helped set him apart:

“I used to go to bed with a book of charts,and just flip through them before I went to sleep. I wasn’t trying to analyze or interpret them, just retain them so that my mind could work on them while I slept.”

Who knows if this exercise worked? What matters is that he was so fired up about being great and forever improving, that he was OK with experimenting and trying out new new things. What will you do differently today? Ludwig von Mises nailed it:

“The class of those who have the ability to think their own thoughts is separated by an unbridgeable gulf from the class of those who cannot.”

True that.

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.