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William Poundstone’s Fortune’s Formula: Trend Following Insights

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Hi Michael,

I’ve been visiting your website for a while now and I just wanted to drop a note of appreciation for the interviews that you put up on your website. All of the interviews I have listened to have been extremely interesting and high quality. I particularly like the diversity of interviewee’s and content covering a wide range of subjects.

I think I first came across you site while looking for information about Daniel Kahneman and came across your interview with him on 212. Which led me to your others interviews. I bought William Poundstone’s ‘Fortune’s Formula’ immediately after listening to your podcast 254 with him and now have a couple of your books on order.

Although I’ve always had an interest in economics, I’ve never been all that interested in trading before but you website has convinced me to take a closer look. So thanks for creating a content packed website and great interviews. I now look forward to any new interviews you do and visit your site frequently for any updates.

Thanks in advance,
[Name]

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Ep. 254: William Poundstone Interview with Michael Covel on Trend Following Radio

William Poundstone
William Poundstone

My guest today is William Poundstone, an American author, columnist, and skeptic. He has written a number of books including the Big Secrets series and a biography of Carl Sagan.

The topic is his book Fortune’s Formula: The Untold Story of the Scientific Betting System That Beat the Casinos and Wall Street.

In this episode of Trend Following Radio we discuss:

  • Claude Shannon
  • The connection between Al Capone
  • The Kelly formula, bookmaking, and the telephone industry
  • Bell Labs and information theory
  • Why, when betting, if there’s a small chance of losing everything, you will eventually lose everything
  • Criticisms of the Kelly criterion
  • Ed Thorp, blackjack, and card counting
  • Long-Term Capital Management
  • Martingale vs. Kelly
  • Early development of the Black-Scholes formula

Listen to this episode:

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