Michael Covel speaks with Scot Billington and Jon Boorman on today’s podcast. Scot Billington is one of the managers of Covenant Capital along with Brince Wilford. Billington is the Chief Manager, Head Trader, and is responsible for all system development at Covenant. Covel and Billington discuss his firm’s exceptional performance in September of 2014; why low volume and low volatility tend to be accompanied by low returns; whether all of Billington’s trend following trading is predicated on a weekly system; Billington’s background and what got him into the systematic trend following space; why simplicity is the ultimate sophistication; marketing vs. trading reality; why certain investors try and disguise their trend following strategies as something else; why trend following is one of the most repeatable, teachable strateges; why the world still believes in the efficient market hypothesis; why trends continue to emerge as a function of the marketplace; the idea of a barbell strategy; and why upside volatility is not such a bad thing. Next, Covel talks with Jon Boorman in his second visit to the podcast. Boorman is the President and CEO of Broadsword Capital, LLC, a Registered Investment Adviser in Charlotte, NC. Boorman has spent over two decades in global markets, witnessing first-hand some of the most tumultuous periods in financial history. Boorman started the Alpha Capture blog in January 2013 to keep a record of trading signals and market commentary, and demonstrate to a wider audience what could be achieved through trend following. The primary aim has always been to inform and educate. Covel and Boorman discuss the fear of public speaking; the idea of ego in the context of both trend following and buy & hold systems; why you’d seek to minimize rather than eliminate both ego and emotion in the context of trading; how Boorman and Jerry Parker connected and Parker’s early influence on Boorman; both Parker and Boorman’s views on exit strategies; how Twitter changes the level of access we have to each other; whether Boorman’s RIA might move into a fund structure; and process vs. outcome.
Michael Covel speaks with Jon Boorman, CMT, a market technician, analyst, and trader with 25 years of experience in global equity, forex, and futures markets. Boorman employs trend following and momentum strategies to generate actionable trade ideas. Boorman has been with many big firms in the past 25 years, but now works on his own outside of the infrastructure of the big investment banks and brokerage firms. Covel and Boorman discuss what it was like working within the big firms; Boorman’s beginnings and how he found his way to where he is today; what advice Boorman would have for newcomers, and whether the training Boorman went through is still relevant to up-and-comers today; how regardless of your access, success comes down to the individual; price-based trend following vs. other technical analysis; Boorman’s early “a-ha” moments towards trend following; trend following complexity, and why it can be “simple, but not easy”; trading your own personality; Van Tharp, risk management and position sizing; trend predicting vs. trend following; the fantasy of calling tops and bottoms; why the major media outlets don’t give trend following proper coverage, and why trend followers don’t make good “copy”; mistaken emphasis on entries rather than exits; the idea that Boorman “no longer having a need to be right” after he left Lehman Brothers; alpha capture; acceptance of trend following amongst the larger financial community; and understanding the legendary trend following traders such as Bill Dunn and Jerry Parker.