Trend Following: How Great Traders Make Millions in Up or Down Markets

Discussion in 'Educational Resources' started by alesanti, Jul 17, 2006.

  1. i'll be happy to answer you. trend following , as defined by the book's author, when tested shows results a random fashion. there is no edge to buying higher highs, or selling lower lows. how many movements in one direction ( any time frame ) increase the probability that the next movement will be in the same direction? if a flipped coin comes up heads 10 times in a row, are you in a heads trend?

    the author does not shed light on your question, however, the book is entertaining.

    this has been discussed ad nauseum on elite. do a search, if you want to learn more.

    #11     Jul 17, 2006

  2. i just returned from a hedge fund symposium in NYC. what i found quite interesting is christian baha's billion dollar fund--SUPERFUND's booth was giving out "trend following"--they had 100's of copies of the book. the book does not directly endorse or even mention superfund. this is incredible marketing power on MC's part. no idea how this was accomplished, but i am impressed.

    #12     Jul 17, 2006

  3. MC claims to be the "evangelist" of trend following. perhaps the sermon comment is not off the mark.

    #13     Jul 17, 2006
  4. You seem to be laboring under the faulty premise that there is only one way to define a trend and then trade it. Such a conclusion is either naive or self-serving. Particularly amusing is that you accept at face value such a definition from a non-trader whom you clearly do not hold in high regard. In playing card parlance, you are stacking the deck. Perhaps Covell is not the only "creative" marketer in this discussion, eh?
    #14     Jul 17, 2006
  5. Good book - unless you want to learn something about trends and making money from them.

    He goes on and on - with interest, but you never learn anything.

    Trends (IMHO) are the most profitable things to invest in, but don't look for any answers on how. there is none.

    Would I buy it? Sure - lots of pithy quotes and anecdotes.
    #15     Jul 17, 2006

  6. pray tell, mr. dog.

    a series of higher highs or lower lows is the only way i know to define this term.

    how do you define a price trend?

    i am always open to new ideas.

    #16     Jul 17, 2006
  7. I'm curious -- for those who don't believe in trend following, what happens if you get into a trade for whatever reason, and it just keeps going in your favor? Do you simply exit the trade because "trend following is faulty"? I mean, if it's stupid for someone else to sell while something is trending lower, doesn't that also imply that you have to cover your short?

    Also: does calling a reversal and suffering an initial drawdown before it finally turns and starts "trending" your way, somehow make that trade more valid, vs a trend follower who enters at the exact same price, only instead has waited for the market to start confirming that direction before entering?
    #17     Jul 17, 2006
  8. If I were to tell you my own definition of a trend, I would essentially be disclosing the method by which I trade it. The setup is integral to the definition. It is easy to beat up boilerplate definitions as you seem to enjoy doing, however, few people will disclose proprietary definitions for your testing pleasure. I am certainly not among them.
    #18     Jul 17, 2006
  9. Exactly!
    #19     Jul 17, 2006
  10. may want to try buying higher lows and selling lower highs....that could prove more interesting....not to mention more profitable....
    #20     Jul 17, 2006