Michael, I was probably victim of using rhetorical exaggeration to express the point that there seems to be a lot of forum posts in the flavour of "I like Covel and Faith is sh*t" or "I like Faith and Covel is sh*t" (as seems to be the case of kiwi_trader for example...) Talking from my experience, reading Trend following provided me with many aha! moments (so dear to Seykota) as it deals with the actual trading philosophy - I did not get those when reading Way of the Turtle (even though I still enjoyed reading it). Anyway - sorry if i add oil to the fire as I do not really want to get involved in this debate..
This "kiwi" guy, bless him, has been consistently anti-Covel for years. His anger is not new. It is borderline pathological, but in many ways I feel lucky to have him! Chat rooms, like this, are tricky. There are indeed many quality and intelligent people in here, but there are also some angry and delusional nuts too. Everyone has to develop their system for filtering. People can always examine my books, film etc. and compare my works to posts that yell assorted obscenities. Everyone will get what they want!
This is a very good example of trend following trading http://www.freetradingvideos.com/vlog/default.asp http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:trend_lines
Yes that is the problem with Covel, shuffling $1,800 courses puts him in the snake oil salesman category. Bless him, even though he is just another 'educator' taking money from people trying to learn to trade. If he wants to be taken seriously, why doesn't he trade and post his results? Yeah right. Keep peddling the $1,800 courses Covel.
Exactly, Jezi! Don't get me wrong, I have no problem with smacktalk. Corvel has done some ballsy research, and good for him. CF seems to be taking the silent method, rarely rising to the bait - has other fish to fry, it seems. But both writers benefit. How? Old news: the only bad publicity is no publicity. Fifty years ago, the wrestler Gorgeous George taught young Cassius Clay this truth: "Don't matter whether they love you or hate you, whether they want to see you win or get whupped. Either way, it puts butts in seats." Sound & fury work the same way to sell books. For the rest of us, best to glean what's useful and move on! Caveat emptor is for each individual reader/trader to decide - sift the noise for yourself and get to the paydirt (pun unintended).
But Market conditions do change! Trend-following is a great system, no doubt, but it is not the only one that makes money. It does work when Markets trend. ( Right now,for example it's making me a nice profit in Gold futures.) But no less a trader than Paul Tudor Jones says that markets trend only 15% or the time, and the rest of the time they move sideways. (Schwager Market Wizards, p 149) He goes on to add (p 135) that of all the systems he's tested, trend-following does (or did - he had only been trading it for six months when he was interviewed in 1989). The percentage Paul Tudor Jones quotes varies (see below) but whatever numbers are used the point is valid - trend-following is not the best method for all market conditions. He also adds (remember, this is 30 years ago) that he uses his own version of trend-following primarily as a back-up, to tell him when to get out of the market (p 144) and that it serves a purpose, even if used temporarily, for new traders to learn how to use discipline and develop risk management (p 145) Is Jones for real? For more on this billionaire, see http://www.turtletrader.com/paul-tudor-jones-interview.html And http://en.wikipedia.org/wiki/Paul_Tudor_Jones Personally, I like what Van Tharp has to say about developing not just one system to fit all market conditions, which is difficult, but to have at least three well-developed systems for various markets. Here's a quick take from his book Super Trader, 2009: I like this idea of having different strategies for six market conditions 1. sideways stable, 2. sideways volatile, 3-4. bullish stable and volatile, 5-6. bearish stable and volatile. Tharp uses a 13-week window back-tested to 1950 - if the average change is less than 5.53% either way, he considers this a sideways market, great either way, bullish or bearish market condition. To measure volatility, he uses a 13-week ATR for the same period. Less that 2.87% ATR = quiet market, greater = volatile. Over the past 58 years, 41.35% of the time the Market is volatile, 11.91% it is bearish, 58.29% sideways, and 29.8% bullish. Curtis Faith (if you will pardon me!) makes similar points in his books. Bottom line: If you have only one trading system, then Trend-Following is certainly a very good choice. However, others do well in different market climates. And it just makes more sense, IMHO, to have more than just one trading system. I don't mean to rile the folks here who are fanatical about their system, and poo-poo all others - hardcore goldbugs, religious zealots, and certain Mac users are like this. But I feel there's plenty of room for a variety of methods. All work well, depending on the market conditions, the user's personality, and trader discipline. By way of introduction. I do not usually speak up in forums. I'm still a new trader, and newer to this particular forum, but I have picked up a few things over the past 60 years and I don't mind speaking my mind. Maybe I am wrong about all this. If so, show me, and I will be grateful. I can take the charge at home plate with the best of them, but I do not like the childish tit-for-tat that passes for discussion in too many of these blogs. If all you have is the ad hominum crap and disrespect, if you want to indulge in pointless flame-wars, if you always need to be right, then I won't waste my time. We are supposedly here to help each other, I think - correct?
We all know what happens to people who go after systems/return that consistently make money in all markets, like clockwork. See LTCM, Niederhoffer and Madoff