Trend Following (Updated Edition): Learn to Make Millions in Up or Down Markets By Michael W. Covel


Cover certainly makes a great case for trend following. Like the Complete Turtle Trader, there are no specific trading systems in this book. But if you're paying attention, you pick up some great insights on how to approach the markets and where to begin in developing your own system. English Makes a good case for trend following, but no actionable trading lessons. Misleading Length. Misleading Title.

I am a millennial, an entrepreneur, a creative person. I am not a trader, but I'm interested in trading and have made some mistakes in the past trying to buy and sell stocks or mutual funds. This book seemed like it would explain a simple type of trading, one where you do not need to be a computer programmer or dedicate your life to day trading.

I previously have read The Complete Turtle Trader and really enjoyed it. It told the story of Richard Dennis in an informative and entertaining way - and then it laid out a set of rules that Richard Dennis used to train his Turtles how to trend follow. It actually had steps you could take to create your own system of trend following, and I was able to implement the rules to earn some real money in the cryptocurrency markets.

I then started listening to Michael Covel's podcast, Trend Following Radio. After 5-6 episodes, I decided to buy Trend Following on Audible after everyone kept referring to it as a great book.

When I saw the length of this audiobook, 24 hours, I was impressed. I started listening to the book on walks, enjoying the stories about the trend followers, hearing about how much money they made in up and down markets.

After about 11 hours in, I was excited for the next half of the book where I was certain the author was going to start walking the listener through the different strategies required to become a trend follower. Processes, models, risk & volatility best practices, and position sizing. These are the nuggets I was expecting from the book.

Instead, the book ended shortly after and I was extremely disappointed that the next half of the audiobook was 2 hours of side bar quotes that lose their meaning when read one after another for 2 hours straight. Then the next ~10 hours or so was free podcast episodes.

The narrator did a really good job, and the stories were great. The book was very well written. I'm not saying it was a bad book, I was just disappointed because I expected the same type of actionable information from Trend Following that I got from The Complete Turtle Trader.

I see Michael Covel has another book called Trend Commandments: Trading For Exceptional Returns - maybe what I was looking for is in this book, because it wasn't in Trend Following.
English Michael W. Covel (M.B.A. '94) English I like the ideas behind the trend following trading. After reading this book and the author's other book I'm left wondering which stocks should I select to start following the trends? I emailed the author asking this question and at first, he implied that I didn't read the book. Then he said I could sign up for his program which costs thousands of dollars.

I thought the point of this book and the turtle experiment was that anyone could be trained to do trend trading. Apparently, the author wants you to shell out thousands of dollars to do so which was disappointing to hear. English I've actually read an earlier edition before. It's mostly a rehash of the same concepts, like how to identify long and short-term trends, position sizing, buy points, etc. There is A LOT of material on WHY trend following works, with heaps of anecdotal information and chart references to back it up. This necessarily covers a lot of market psychology underlying why trend following works. If you are looking for an actionable plan to follow from A-Z, then this book is probably not for you. I am reminded of the oft-quoted adage The Trend is Your Friend, Until it Ends. From experience, I can say that such endings can be quite catastrophic, especially if one were merely riding a trend without paying heed to the fundamentals. As expected, there is scant discussion about what to do when a profitable trend ends sharply, busting through all your stops and leaving you with a large and massively underwater position. At best, I would recommend investors apply trend following as only one tool in the arsenal and never over an entire portfolio. [Rating: 3.5*] English

  His cutting-edge and unorthodox perspectives have garnered international acclaim and have earned him invitations with: China Asset Management Co., Ltd., GIC Private Limited (Singapore sovereign wealth fund), BM&F Bovespa, Managed Funds Association, Bank of China Investment Management, Market Technicians Association. He also has the distinction of interviewing four Nobel Prize winners in economics, including Daniel Kahneman and Harry Markowitz and has been featured by major press, including: The Wall Street Journal, Bloomberg, CCTV, The Straits Times and Fox Business.   Trend Following (Updated Edition): Learn to Make Millions in Up or Down Markets

Trend

This book is rubbish. It's full of baseball analogies, and no math or hard research. English For the Haters versus Lovers of this book

Let me start with Haters, their reasoning..
All the haters are correct that this book contains lot of cliches with no actual tutorial on how to build your own system. A lot of chapters are anecdotes, famous quotes, and even baseball analogies that seem awfully far stretched from trading. All of the complaints are correct, and I wouldn't argue with any of them.

Let me end with why this book is the ultimate book for learning about trend following...
I can imagine that most people who hate on this book, carry the same attitude in life toward anything they endeavor on. The haters simply wanted to be told a very specific method so they can start using and quit their mundane jobs and all become millionaires.

Any hater who superficially scan for the holy grail will be disappointed, of course they will, because they can't think long enough about why this book was written.

Imagine if Michael Jordan publishes a book about his success, and you purchase it and get disappointed why Jordan didn't include his holy grail for his basketball success. How would you feel if your friend complained that Jordan didn't tell people specifically how he succeeded?

The ultimate truth is, trading is pretty much like a sport, can't be taught but it can be learned, through numerous trial-and-error, self doubting and endless nights of questioning.

Richard Dennis once said, he could publish all his rules in news paper and no one would use it.
Alexander Elder and Tom Basso discovered that entry really didn't matter, as long as exits are well taken care of.
William Eckhardt said that emotional intelligence is probably the determining factor in trading success.

Anyone can starting using the rules published in Covel's complete turtle book, the 4 week high entry with 2x ATR price stop coupled with perhaps 20day moving average time stop. But to which extent are you able to use that system perfectly depending primarily on your ability to stick to the system without doubting.

Of course time-to-time you will modify the system due to new experience gained.
But the specific setup, there is no holy grail.

Covel's book is good in inspiring people who already have a deep understanding of trend following, however it does not serve to teach you how to trend follow. Much like no basketball player will teach you specifically how to cross and shake an opponent, because it's not possible to teach. Any book promising to teach you how to pick up chicks at a bar are usually charlatan who's making false promises.

No skills whatsoever in any arena in life can be taught. The best hackers are self taught, the best photoshop users are self taught, the best rappers are self taught. The idea that someone can transfer his/her knowledge to you through a speech/book is just nonsense. Experience cannot be replaced by simply reading a book, or listening to audiobook on Youtube.

My reasons why I love this book:
Because it shows that trend following works, and it makes sense to me. Trend following system hibernates during ranging period that whipsaw, forcing you to trade smaller and smaller using the 1%/2% equity risk rule, and makes you trade larger during trending period. The purchasing power is well protected/preserved during unfavorable market. If this doesn't make sense to you then I don't know what makes sense.

Trend following does not discriminate against any asset classes, or previous highs/lows. Any trending signal will be picked up and force the trader to ride until it dies down. Any news, fundamental figures, comments from analyst are ignored because trend followers expect that future cannot be predicted but trend won't stop until it stops. This makes total sense to me and I'm happy to put my money on the line because it sounds logical.

Conclusion:
Don't pick up this book if you're hoping to be taught and transformed into a trend following trader and start making millions, you won't, just like any book that teach you how to pick up chicks and dating won't transform you into an alpha male with super jacked muscle.

Do read this book if you want an extensive background info on why trend following works, and how the successful traders look at the markets.

You have to ultimately put in the work to gain that experience to succeed as a trader, which isn't easy, and 99% of us retail traders won't make it there.

But any arena in life is like that. However it is worth a try isn't it? You have your dreams waiting for you right? English You won't find any working investment methods / strategies / systems in this book.

Instead, it is quite a lengthy treaty about the superiority of trend followers over all other investors (with small exception of Jim Simons from RenTec, for the author seems to have no idea what Simons is actually doing).

One thing you should definitely remember from this book is: the trend followers never lose any money. They may have some deep and possibly terminal drawdowns though...

Nevertheless, there are many potentially useful concepts here. It would be much easier if they were not mixed with pervasive trend following propaganda. English 1. I read an ebook copy of this from Scribd and never noticed the cover until now. It's pretty terrible and ridiculous (that had nothing to do with my rating).

2. This book is interesting, but it's like a long advertisement for Trend Following without all that much 'meat'. Trend Following is great because it does this.... trend following is great because it was on the short side of this disaster.... Trend Following is like Money Ball, you want to be like Money Ball right? C'mon drink the Trend Following Kool-Aid, it tastes so much better than the Kool-Aid those Fundamental Investors and Value Investors have for sale. Drink it up!

One reviewer said, Imagine if Michael Jordan publishes a book about his success, and you purchase it and get disappointed why Jordan didn't include his holy grail for his basketball success. How would you feel if your friend complained that Jordan didn't tell people specifically how he succeeded?

And that is kind of a fair description of some criticisms for any trading book that people whine doesn't have the 'secret' that will make them Warren Buffet rich by next week. The only problem is this criticism doesn't really hold for this book, this isn't Michael Jordan writing a book on basketball success, it's the journalist at some Chicago Newspaper who covered Jordan back when he was on the Bulls and then started a website about being like Mike, and published books about playing Jordan-esque styles of basketball and how it's superior to say the Pippen and Magic Johnson school of Basketball. If Richard Dennis, or Ed Seykota, or some of the other legendary Trend Following traders had written a book I'd totally agree with that criticism.

But, on the plus side the book is very persuasive about merits to the Trend Following philosophy but it also reads a bit too much like propaganda and while it highlights traders who at one time may have had a contrarian approach (in relation to the methods they traded on, not on the directional bias of their trades which are anything but contrarian since that would be against the idea of following trends) there is a little too more conformity to an acceptable way of approaching the markets here.

One day I'll start writing more about some of these things. Tonight I really just wanted to write a review that said the cover is fucking ridiculous. English There were a few interesting tidbits contained in this book, but most of it I could have done without. For someone who complains that trend-following critics spend too much time cherry picking bad examples and not looking at the data, the author:
* spent half the space in the book on illustrative quotes which always seem to be on his side
* counters each cherry-picked (both by the original critic and then by him as a straw-man) criticism with multiple cherry-picked counter examples
* uses performance data from a different set of firms for each time period and argument
* drops far too many names in the first-person (I have spoken to Cool Hedge Fund Guy #37 and he told me that I am right)
* dedicates one whole chapter (plus large sections of other chapters) to personality profiles and anecdotes about a trading style that he claims is systematic and rule-based (as opposed to intuitive, emotional, or some other characteristic which would justify all the different personality/psychology stuff)

Plus, the grammar is horrible (spelling was fine) and at least one section referred the reader to various colours on a BLACK AND WHITE GRAPH. English

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