Trend Following With Michael Covel

My guest today is Justin Fox, an American financial journalist, commentator, and writer born in Morristown, New Jersey. He is a Bloomberg Opinion columnist and former editorial director of the Harvard Business Review Group and business and economics columnist for Time magazine. The topic is his book The Myth Of The Rational Market: A History of Risk, Reward, and Delusion on Wall Street. In this episode of Trend Following Radio we discuss: Harry Markowitz, Bayesian statistics, and making smart decisions in an uncertain world using quantitative tools Stocks, beta, and the importance of making useful predictions Commodities Corporation and trend following trading in the early 1970's Why a market in which everyone was rationally anticipating the future would be a random market Amos Hostetter How the behavioral mindset started to unfold in the 1970's Eugene Fama and the efficient market hypothesis The Capital Asset Pricing Model Why well-designed markets and well-informed investors are prone to manias and panics

Please enjoy my monologue The Whipsaw Guy with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive. --- I'm MICHAEL COVEL, the host of TREND FOLLOWING RADIO, and I'm proud to have delivered 10+ million podcast listens since 2012. Investments, economics, psychology, politics, decision-making, human behavior, entrepreneurship and trend following are all passionately explored and debated on my show. To start? I'd like to give you a great piece of advice you can use in your life and trading journey… cut your losses! You will find much more about that philosophy here: https://www.trendfollowing.com/trend/ You can watch a free video here: https://www.trendfollowing.com/video/ Can't get enough of this episode? You can choose from my thousand plus episodes here: https://www.trendfollowing.com/podcast My social media platforms: Twitter: @covel Facebook: @trendfollowing LinkedIn: @covel Instagram: @mikecovel Hope you enjoy my never-ending podcast conversation!

My guest today is Thomas Gilovich, an American psychologist who is the Irene Blecker Rosenfeld Professor of Psychology at Cornell University. He has conducted research in social psychology, decision making, behavioral economics, and has written popular books on these subjects. The topic is behavioral economics. In this episode of Trend Following Radio we discuss: How his world dovetailed into money and markets Basketball, streak shooting, and the "hot hand" Randomness and the clustering illusion The missing Malaysian Airlines flight and probability The reluctance to accept a probabilistic view of the world Politics, predictions, and probabilities People who see the world in black and white Drawing conclusions from incomplete and unrepresentative evidence, and how to avoid that folly The position of the devil's advocate, and the importance of that role Gilovich's response to the media's talking heads, and their often black and white opinions Behavioral economics vs. traditional economics When people do the wr

My guest today is Tom Dorsey, the co-founder of Dorsey, Wright & Associates in 1987. Dorsey joined Nasdaq Global Information Services with Nasdaq's acquisition of his company in 2015. He has been a regular guest on Fox's "Cavuto on Business" and "Bulls & Bears" programs, and frequently speaks to audiences worldwide on topics related to the stock market, technical analysis, and Relative Strength investing. The topics are his books Point & Figure Charting: The Essential Application for Forecasting and Tracking Market Prices, Thriving as a Broker in the 21st Century and Tom Dorsey's Trading Tips: A Playbook for Stock Market Success. In this episode of Trend Following Radio we discuss: View of technical analysis, with a specialization in point & figure and relative strength Dealing with a bear market in Dorsey's early days Early training in options; how Dorsey learned about point & figure trading Definitions and explanations of point & figure trading How point & figure works like a te

My guest today is Marc Faber, a Swiss investor based in Thailand. He is the publisher of the Gloom Boom & Doom Report newsletter and the director of Marc Faber Ltd, which acts as an investment advisor and fund manager. The topic is economics. In this episode of Trend Following Radio we discuss: Current state of Russia Changing geopolitics Faber's experience living through the Cold War The difference between Crimea's value to the west and its value to Russia Why the Russians perceived the uprising in Kiev to be financed by western power China's reaction to the situation in Crimea; the construction boom in China The difficulty of forecasting China's geopolitical changes Positive and negative valuations of the market, and finding investments to be "cheap" or "expensive" Faber's advice to young people following his path today in the face of money printing and bailouts What can be done about wealth inequality Making a living in the face of instant communication and globalization Central banks' role in wealth

My guest today is Martin Bergin, CEO of Dunn Capital Management. Bill Dunn and Dunn Capital were famously profiled in Covel's book Trend Following and they have a 39 year track record of trend following performance. The topic is Trend Following. In this episode of Trend Following Radio we discuss: The early stages of Dunn Capital, and how it arrived where it is today Trend following with futures Volatility within Dunn's system, and why volatility is important to the overall performance Targeting losses How history informs system creation Adapting to the marketplace and to available technology What it means to be 100% systematic with no overrides Defining "black box" systems, and the difference between Dunn Capital's strategy and black box strategies Location in relation to Dunn Capital, and why it isn't necessary to be in a big city like London or Tokyo How the core of Dunn Capital has stayed the same while certain aspects of business has evolved Decreasing drawdown without decreasing profitability Behaviora

My guest today is Howard Lindzon, a Canadian entrepreneur, author, financial analyst, technical analyst and angel investor. Lindzon manages a hedge fund, serves as managing partner of the holding company Social Leverage, limited partner at Knight's Bridge Capital Partners, and is the co-founder of StockTwits. He's also known for the satirical podcast Wallstrip.  The topic is entrepreneurship. In this episode of Trend Following Radio we discuss: The commonalities between the angel investing world and trend following Over-diversification Diversification in private investments vs. stocks How Lindzon got the entrepreneurial "bug" Lindzon's early career as a stockbroker The beginnings of Wallstrip Lindzon's comedy influence How Wallstrip led to the next four years of Lindzon's investments How Lindzon's mistakes helped him grow as an investor Lindzon's experience with fraud committed by a business partner Keeping your business drama-free The issue of distraction Lindzon on the birth of StockTwits The investment th

My guest today is Victor Sperandeo, known as "Trader Vic", a US trader, index developer, and financial commentator. He serves as the President and CEO of Alpha Financial Technologies, LLC (AFT), is a founding partner of EAM Partners L.P., and serves as the President and CEO of its general partner, EAM Corporation. The topic is trading. In this episode of Trend Following Radio we discuss: Recent public policy directions Trading against your public policy interests Zero interest rate policy Whether the S&P is a "bribe" The Fed mandate to keep stocks from falling and to stop volatility The wealth effect Why the stock market going up is a very poor instrument to fix the economy The trend towards socialism Sperandeo's experience working with George Soros Sperandeo's experience with the DTI index lack swans and the effects of large, catastrophic events on the market; why the only way to protect yourself is extreme diversification; volatility balancing; and Sperandeo's experience as a young man and how he came

My guest today is Carl Richards, a Certified Financial Planner and creator of the Sketch Guy column, appearing weekly in The New York Times since 2010. Carl has also been featured on Marketplace Money, Oprah.com, and Forbes.com. The topic is finance. In this episode of Trend Following Radio we discuss: Richards' new radio venture How Richards came to start The Behavior Gap Outliers, and living your own bell curve Risk on a daily, weekly, and monthly basis The definition of radical self-awareness Mindfulness and awareness as applied to our financial decisions Habit, action, feeling, and thought Simplicity and effectiveness Government intervention in the markets Quantitative easing Buy and hold in Japan Loss aversion and the pain of loss Feeling loss more than the joy of gain Jump in! --- I'm MICHAEL COVEL, the host of TREND FOLLOWING RADIO, and I'm proud to have delivered 10+ million podcast listens since 2012. Investments, economics, psychology, politics, decision-making, human behavior, entrepreneurship an

My guest today is Sam Polk, a former wall street banker who walked away after making millions. Today, Polk runs a non-profit to help the poor understand nutrition. However, his op-ed is definitely controversial. The topic is his op-ed For The Love of Money.  In this episode of Trend Following Radio we discuss: The intensity surrounding the reaction to Polk's op-ed piece Reactions from friends and colleagues about the article Envy and jealousy in the Wall Street world Polk's background and life growing up Filtering cultural messages The line between individual responsibility and being part of a system Crony capitalism Power dynamics The mythology of risk-taking in America The solution for the investment banks out there Polk's non-profit which he runs today Jump in! --- I'm MICHAEL COVEL, the host of TREND FOLLOWING RADIO, and I'm proud to have delivered 10+ million podcast listens since 2012. Investments, economics, psychology, politics, decision-making, human behavior, entrepreneurship and trend following a

Please enjoy my monologue Risk, Reward and The Process with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive. --- I'm MICHAEL COVEL, the host of TREND FOLLOWING RADIO, and I'm proud to have delivered 10+ million podcast listens since 2012. Investments, economics, psychology, politics, decision-making, human behavior, entrepreneurship and trend following are all passionately explored and debated on my show. To start? I'd like to give you a great piece of advice you can use in your life and trading journey… cut your losses! You will find much more about that philosophy here: https://www.trendfollowing.com/trend/ You can watch a free video here: https://www.trendfollowing.com/video/ Can't get enough of this episode? You can choose from my thousand plus episodes here: https://www.trendfollowing.com/podcast My social media platforms: Twitter: @covel Facebook: @trendfollowing LinkedIn: @covel Instagram: @mikecovel Hope you enjoy my never-ending podcast conve

My guest today is Jack Schwager, a recognized industry expert in futures and hedge funds and the author of a number of widely acclaimed financial books. Schwager is one of the founders of Fund Seeder. Previously, he was a partner in the Fortune Group, a London-based hedge fund advisory firm. His prior experience also includes 22 years as Director of Futures research for some of Wall Street's leading firms, most recently Prudential Securities. The topic is his book The Little Book of Market Wizards. In this episode of Trend Following Radio we discuss: How Fund Seeder acts as a liason for traders and investors The difficulty of starting out as a new trader How Fund Seeder is a global opportunity Schwager's last book, Hedge Fund Market Wizards The timeless quality of the Market Wizards books Jesse Livermore's Reminiscences of a Stock Operator How human nature is the only thing that will never change Looking for a "secret recipe" in the Market Wizards book "The Upside of Down: Why Failing Well Is The Key To Succ

My guest today is Al Abaroa, the Chief Investment Strategist at Kingsview and has been a registered broker and trader since 1993. He has seen all aspects of the investing industry. The topic is a white paper that Abaroa wrote about trend following. In this episode of Trend Following Radio we discuss: How people forget that anything can and will happen Why we're seeing optimistic behavior in the market The similarities between the WhatsApp/Facebook acquisition and the AOL/Time Warner acquisition Abaroa's wealth formula "Reasonable returns" Long term vs. short term outlooks The advantages of youth in trading Lifespan growth, and retirement Tom Basso and black swan events Looking back on major crashes Development and distribution as the two modalities of price Focusing on price action The Global Volatility Index Looking at black swan periods as a place to profit The asymmetrical return stream and the asymmetrical nature of trend following Why trend following produces returns a minority of the time Position sizi

Please enjoy my monologue Trend Following Winners, Daniel Kahneman, and Tina Turner with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive. --- I'm MICHAEL COVEL, the host of TREND FOLLOWING RADIO, and I'm proud to have delivered 10+ million podcast listens since 2012. Investments, economics, psychology, politics, decision-making, human behavior, entrepreneurship and trend following are all passionately explored and debated on my show. To start? I'd like to give you a great piece of advice you can use in your life and trading journey… cut your losses! You will find much more about that philosophy here: https://www.trendfollowing.com/trend/ You can watch a free video here: https://www.trendfollowing.com/video/ Can't get enough of this episode? You can choose from my thousand plus episodes here: https://www.trendfollowing.com/podcast My social media platforms: Twitter: @covel Facebook: @trendfollowing LinkedIn: @covel Instagram: @mikecovel Hope you enjoy

My guest today is Jonathan Hoenig, an American, founding member of the Capitalist Pig hedge fund, and a regular contributor to and regular panelist on Fox News Channel's Cashin' In, Your World with Neil Cavuto, Red Eye w/ Greg Gutfeld and WLS 890's morning show, Don Wade & Roma. The topic is his documentary Pit Trading 101. In this episode of Trend Following Radio we discuss: Hoenig's branding for his hedge fund, Capitalist Pig Why capitalism has become demonized The difference between capitalism and crony capitalism Ayn Rand and capitalism as the "unknown ideal" How Hoenig ended up in the Chicago trading pits, and what we can learn from studying pit trading today The physical type of pit traders The subculture of the pits Where Hoenig sees futures markets going The blame of speculators America's place in the world today Jump in! --- I'm MICHAEL COVEL, the host of TREND FOLLOWING RADIO, and I'm proud to have delivered 10+ million podcast listens since 2012. Investments, economics, psychology, politics,

My guest today is Daniel Kahneman, the second Nobel Prize winner to appear on this podcast. Kahneman is an Israeli-American psychologist and economist notable for his work on the psychology of judgment and decision-making, as well as behavioral economics, for which he was awarded the 2002 Nobel Memorial Prize in Economic Sciences. The topic is behavioral psychology. In this episode of Trend Following Radio we discuss: Kahneman's beginnings, and how he came to realize he was looking at the world from a different vantage point than most How Kahneman's work is foundational to trading Questioning the dogma of rationality Happiness, and the distinction between the remembering self and the experiencing self The consumption of memories The danger of not making peace with a loss Bubbles and crowd behavior Happiness research and public policy Emotion, possibility, and probability Hope and fear Why optimism is the engine of capitalism The influence of prospect theory Jump in! --- I'm MICHAEL COVEL, the host of TREND

My guest today is John Bollinger, an American author, financial analyst, contributor to the field of technical analysis and the developer of Bollinger Bands. Since 1987, he has published the Capital Growth Letter, a newsletter which provides technical analysis of the financial markets. The topic is Trend Following. In this episode of Trend Following Radio we discuss: Bollinger Bands as described for the lay person Defining when a price is relatively high or relatively low Defining "relatively high" and "relatively low" Measuring volatility to determine the "width" of a Bollinger Band Standard deviation The beginnings of Bollinger Bands, and how John Bollinger came to put it together Different ideas about volatility in the 1980s Some of Bollinger's early curiosity triggers, and why he started digging into finance after going to art school Light, film, and Bollinger's experience at the School of Visual Arts Bollinger's experience in his apprenticeship to learn technical analysis "The best authority is the pric

Please enjoy my monologue Seykota, Harding & the 2014 Trend Following Conference with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive. --- I'm MICHAEL COVEL, the host of TREND FOLLOWING RADIO, and I'm proud to have delivered 10+ million podcast listens since 2012. Investments, economics, psychology, politics, decision-making, human behavior, entrepreneurship and trend following are all passionately explored and debated on my show. To start? I'd like to give you a great piece of advice you can use in your life and trading journey… cut your losses! You will find much more about that philosophy here: https://www.trendfollowing.com/trend/ You can watch a free video here: https://www.trendfollowing.com/video/ Can't get enough of this episode? You can choose from my thousand plus episodes here: https://www.trendfollowing.com/podcast My social media platforms: Twitter: @covel Facebook: @trendfollowing LinkedIn: @covel Instagram: @mikecovel Hope you enjoy

My guest today is Dave Rapach, an internationally renowned researcher in the area of asset return forecasting. His research is highly cited and published in leading scholarly and practitioner journals in Finance and Economics. Rapach is a Professor of Economics and holds the John Simon Endowed Chair in Economics at the Saint Louis University Chaifetz School of Business.  The topic is Trend Following. In this episode of Trend Following Radio we discuss: Why trend following works from an academic standpoint "Publish or perish" and the difficulty of publishing scholarly articles on trend following Early research on trend following, the random walk theory, and Burton Malkiel's "A Random Walk Down Wall Street" Warren Buffett, Bill Dunn, and survivorship bias A paper that Rapach traces to the reintroduction of trend following and technical analysis to the academic community Measuring systematic risk Eugene Fama's recent nobel prize How the trend following world has been neglected by the academic community How Rapa

My guest today is Ed Seykota, a commodities trader, who earned S.B. degrees in Electrical Engineering from MIT and Management from the MIT Sloan School of Management, both in 1969. In 1970 he pioneered Systems trading by using early punched card computers to test ideas on trading the markets. The topic is his book Govopoly in the 39th Day. In this episode of Trend Following Radio we discuss: Trend Following Seykota's concerns about our economy The assimilation model and how Seykota sees assimilation happening today The definition of "govopoly" How Seykota's mentor's work plays into Seykota's work today Thinking about systems What we can do to "fix" the economy, or to at least prepare yourself The exponential curve that assimilation takes Noticing things before they're important Why Seykota doesn't provide a "solution" to the problem and instead advocates for the system to correct itself What we can do as people in response to the system Detroit as a microcosm of the US Ways to make money during the assimilat