Trend fund performance in 2012 chesapeake -17.8 dunn -18.6 eckhardt +3.9 hawksbill -13.6 hyman beck -19.6 millburn -5.3 rabar -14.3 sunrise -20.0 transtrend +0.7 However, Dunn is up near 20% so far this year an investor advised...
you could argue that it is a negative sum game with commissions and slippage, not to mention being wrong statistically 50%. Same with regular gambling and yet both are industries in the trillions. People like to gamble/invest/trade on uncertain outcomes. why? it is fun/interesting/profitable.
The good news is that trend following is profitable. The better news is that most traders, evidently including all the previous posters in this thread, have no freaking clue how to find a real trend. Good luck with your MA crossovers, random entries or whatever.
New poster here -- I've thoroughly enjoyed lurking for a while, though. While very comfortable with advanced math in my engineering world, I am not a seasoned investor nor a stats guy. Be that as it may: If I plot a (ahem) Renko chart of the S&P using weekly ATR14 bricks on stockcharts.com, and trade every reversal the day after they print, I predict a 2012 performance of + 10.6%. "Buy and hold" looks to be a point better at 11.6%. This is one of the roughest periods I have "backtested", with the trending indicators tending to beat B&H handily, but of course the last 4 years have had a nice (trending) run. Am I off base here? Are these false indicators? Here are the trades, made at the close to be conservative: 1/3: LONG 5/15: SHORT 6/26: LONG 11/6: SHORT 12/18: LONG Max drawdown happened in late December when the trades were out of phase with the "trend" at ~ 10%.