I really enjoy your podcast and thank you for doing it. You are spot on and have added a lot of value to my thinking and challenged limiting mindsets I wasn’t even aware I had.
It would be really helpful if you talked about drawdowns and your “process” for getting through them and overcoming the standard human emotions they generate. Assuming someone is doing everything perfectly in their trend following execution (proper position sizing, diversified, ignoring the news, not looking at charts, using risk capital, etc.), do you have a process for getting through a drawdown when time marches on so slowly and our impulses are now now now?
Let’s say you believe trend following works how do you keep yourself sane and unemotional during difficult stretches. Do you have a process you use?
Thank you!
Kind Regards,
[Name]
Have you listened to all of my Basso, Faulkner and Seykota podcast episodes?
All of the psych pros across my podcast, i.e. Odean, Kahneman, Statman, Ariely, etc.? That’s just a few.
My guest today is Chris Clarke, ex-Goldman Sachs executive director and founder of Lawrence Clarke Investment Management. Clarke has been developing trading systems for decades.
The topic is Trend Following.
In this episode of Trend Following Radio we discuss:
Trusting the system once you choose it
Being prepared to trade no matter which way the markets go
The importance of edge, and why gamblers lose
Looking at the math behind trading strategies
Understanding “market truths”
Drawdowns vs. risks
“The desire to maximize the number of winning trades (or minimize the number of losing trades) works against the trader. The success rate of trades is the least important performance statistic and may even be inversely related to performance.” – William Eckhardt
