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Ep. 512: Tim Price Interview with Michael Covel on Trend Following Radio

Tim Price
Tim Price

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My guest today is Tim Price. He has worked in capital markets for over 25 years across three management firms. A graduate of Christ Church, Oxford, he spent a decade as a bond specialist before going on to serve as Chief Investment Officer at three separate wealth management firms. Tim has been shortlisted for five successive years in the UK Private Asset Managers Awards programme and was a winner in 2005 in the category of Defensive Investing. He is now manager of the VT Price Value Portfolio, a fund investing in Benjamin Graham-style value stocks, and specialist value funds, from around the world. Tim also writes regularly for MoneyWeek magazine and The Spectator.

The topic is his book Investing Through the Looking Glass: A Rational Guide to Irrational Financial Markets.

In this episode of Trend Following Radio we discuss:

  • Trusting central planners
  • Going against the establishment
  • Banking system
  • Owning gold
  • Lehman Brothers collapse
  • 2008 bubble
  • The Brexit and Trump narrative

“Mankind has survived because of our ability to believe in things that do not actually exist.” – Tim Price

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June Trend Following Performance Kills It

Trend following performance rock and roll for June (source):

Sector titans ride Brexit to record largest monthly gain since November 2014, SocGen benchmark shows

London-based trend manager Mulvaney Capital Management surged 27.4% as one of the standout CTA performers in the wake of the Brexit vote.

The $224m London-based manager, founded in 1999 by CEO and CIO Paul Mulvaney, a former Merrill Lynch options trader with computer science background, takes a long-term approach to capturing trends, holding positions for six months on average.

Its Global Markets Program was reportedly up 17% on Friday 24 June as global stock markets tumbled and the pound fell to a 31-year low after the Brexit vote, marking its best day ever.

The program, which has an annualised volatility of 31% was also the standout performer in Europe in 2014, gaining 67% as CTAs had a stellar year amid tumbling oil price and sinking bond yields.

Mulvaney’s return last month recovered earlier losses this year to advance to 15.1% YTD.

Switzerland-based Amplitude Capital saw strong gains, with the firm’s $929m Klassik fund returning 9.98% for June.

Amplitude’s $540m Dynamic fund also saw monthly gains, returning 7.19% with 3 out of 4 asset classes contributing to this result.

Among smaller managers, New Jersey-based NuWave Investment Management also had a strong month, with its main $36m futures portfolio gaining 13.3% in June having been broadly flat YTD at the end of May.

The largest CTAs recorded their biggest monthly gain since November 2014, according to Societe Generale’s benchmark.

The SG CTA Index, which tracks a group of the largest 20 CTAs, ended the month up 4.4% to return to positive territory for the year, up 4.1% YTD.

Among the best performing constituents of the index, Transtrend’s $4.8bn enhanced risk version of its Diversified Trend Program surged 7.5% to hit 8.4% YTD.

Lying flat YTD coming into June, Brummer-backed Lynx Asset Management was up an estimated 10.3%, likely to go down as the $6.3bn Swedish manager’s best month since August 2010.

London and US-based ISAM saw its $1.4bn Systematic Trend program gained an estimated 4%, to pare back YTD losses to -3.2%.

Trend-followers jumped 5.3% in June, according to the SG Trend Index.

It was their best month since August 2014, and they hauled themselves back into the back this year, up 1.9%YTD.

Short-term traders advanced 1.6% in June to remain the best performers this year, up 5.8%.

For Sydney-based Boronia Capital, June was best return since a 10.2 gain in May 2012. The $842m manager was up 5.7% last month to climb to 9.7% YTD.

Quest Partners’ $325m AlphaQuest Original Program was up 6.6% in June and advanced to 18.3% this year. It scored its bets returns through vol breakout systems.

The SG CTA Index had surged 2.3% on 24 June, the day after the UK’s EU referendum. It was its best one-day gain since a 2.7% jump on 20 December 2000, when the Nasdaq plunged after a flurry of analyst downgrades and corporate results drove US technology stocks sharply lower.

Eighteen of the managers in the index made positive returns on 24 June. A similar number reported positive returns for the full month.

Performance figures announced last week showed that CTAs weathered Britain’s EU referendum result well, despite mid-month market uncertainty, having benefitted from diversification across asset classes and positioning.

“CTAs have, so far, managed to weather the Brexit storm by benefitting from diversification across asset classes and positioning,” said James Skeggs, global head of alternative investments consulting at Societe Generale Prime Services.

“The strong returns seen in June were the result of trends in bond, commodity, and currency markets.

Attribution data from the SG Trend Indicator suggests gains in the bond (+4.6%), commodities (+1.1%), and currency (excluding GBP/USD +1%) sectors.

Skaggs added: “In the current environment there is understandably a great deal of investor interest in these strategies which have posted positive returns in eight of the last nine quarters.”

Next Brexit? Are you ready?


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London Trend Follower Up Big During Month of Brexit

Trend following firm Mulvaney Capital finished up +27.33% for the month of June 2016.

+17% alone June 24th.

Why my shout out?

It’s my gig to alert people to the alternatives.

The trader that produced that? Paul Mulvaney. He is featured in my book here.

The Little Book of Trading
The Little Book of Trading

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. 465: Sunrise Capital with Michael Covel on Trend Following Radio

Sunrise Capital with Michael Covel on Trend Following Radio
Sunrise Capital with Michael Covel on Trend Following Radio

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Please enjoy my monologue Sunrise Capital with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive.

In this episode of Trend Following Radio:

  • Brexit and systematic trading
  • Price distribution
  • Price action
  • Directional betting on a coin flip event
  • Preparing for black swan events
  • Are computers good or bad?
  • MAR ratio
  • Diversification

“Systems control the trading ideas. What they do is they give you a statistical edge in creating your trading ideas.” – Chris Stanton

“It’s a bad idea to get the insurance after the catastrophe.” – Jason Gerlach

Mentions & Resources:

Listen to this episode:

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

Ep. 464: The Next Brexit with Michael Covel on Trend Following Radio

The Next Brexit with Michael Covel on Trend Following Radio
The Next Brexit with Michael Covel on Trend Following Radio

Subscribe to Trend Following Radio on iTunes

Please enjoy my monologue The Next Brexit with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive.

In this episode of Trend Following Radio:

  • Boom and busts
  • Brexit
  • Certainty in markets

“Certainty in markets, that is the delusion. That is the media cacophony.” – Michael Covel

Mentions & Resources:

Listen to this episode:

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

Brexit Hysteria Might Be Contagious

Feedback in:

Good morning from the U.S.,

I wonder how many fundamental analysts could have “predicted” the market’s reaction to the Brexit news. It amazes me how many people still believe these “experts” on TV know what they are talking about. Hopefully some day people will learn that trend following is the only way to prepare for these 100-year floods that seem to happen quite often. Thank you for your podcasts and continuing to educate those who are looking for the right way to trade.

“Ride the bucking bronco.” – Bill Dunn

Michael D. Jr.

Thanks!

Let me add some relevant feedback from Sunrise Capital:

At a philosophical level, it is important to understand that while Brexit is in some respects novel and shocking (no country has ever left the European Union and many polls suggested that Britain would stay), from a broader perspective, Brexit is no different than any of the many exogenous geopolitical events that have periodically disrupted markets over the course of our 37 year investment history. As we see it, Brexit is simply another example of an “unexpected” event happening and investors overreacting to that event in such a way that it causes a great deal of immediate market turmoil.

The financial pain caused by this turmoil is real, it is not enjoyable and it is generally not good for the global financial system or people’s faith in that system, particularly in the short term. However over the long haul, as history has proven over and over again through world wars, revolutions, and numerous other types of global disruptions, markets are resilient and ultimately right themselves to some kind of equilibrium level. Accordingly, our approach to Brexit has been quite similar to the approach we’ve taken to numerous other global shocks and that is to plan, prepare and then “keep calm and carry on” as the British would say.

Wisdom.

Contagious?
Contagious?

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.

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