Trend Following: Learn to Make Millions in Up or Down Markets

Trend Following is the result of an eight-year “hazardous journey” for the truth about Trend Following. It fills a void in a marketplace inundated with books about finance and trading but lacking any resource or, for that matter, practically any reference to what we believe is the best strategy to consistently make money in the markets.

Introduction:

Trend Following seeks to capture the majority of a trend, up or down, for profit. It trades for profits in the major asset classesstocks, bonds, currencies, and commodities. However simple the basic concepts about Trend Following are, they have been widely misunderstood. Our desire to correct this state of affairs is what, in part, launched our research. We wanted to be as objective as possible, so we based our writing on the available data:

• Trend followers’ month-by-month perfomance histories.
• Trend followers’ published words and comments over the last 30 years.
• News accounts of financial disasters.
• News accounts of the losers in those financial disasters.
• Charts of markets traded by trend followers.
• Charts of markets traded by losers in the financial disasters.

Trend Following challenges much of the conventional wisdom about successful trading. We were determined to avoid being influenced by lmowledge institutionalized and defined by Wall Street. We were adamant about fighting “flat earth” thinking. During our research, we tried to avoid starting with an assumption and then finding the data to support it. Instead we asked the question and then, objectively,doggedly, and slowly, let the answer reveal itself. We also became interested in:

• How trend followers win in the zero-sum game of trading.
• Why Trend Following has been the most profitable style of trading.
• The philosophical framework of trend followers’ success.
• Timeless principles of Trend Following.
• The Trend Following worldview of market behavior.
• Reasons why Trend Following is so enduring.

Contents:

• Trend Following
• Great Trend Followers
• Performance Data
• Big Events in Trend Following
• Baseball: Thinking Outside the Batter’s Box
• Human Behavior
• Decision-Making
• Science of Trading
• Holy Grails
• Trading Systems

Trend Following: How Great Traders Make Millions in Up Or Down Markets By Michael W. Covel PDF