#137 Radio Show Investing Series: Using Trends to minimizing losses and compound
In this episode, I dive into a style of investing called Trend Following or Momentum. Designed to minimize portfolio drawdowns. Being rules-based, investing removes emotions from decision-making. Investing broadly across asset classes and geography provides investors with more opportunities to see returns. The research supports the approach to lower risk and potentially enhance long-term returns. There are loads of data from research that provides strong out-of-sample evidence that there is consistent, long-term evidence that trends have been pervasive features of global stock, bond, commodity, and currency markets. If you want to learn about something a bit more unconventional, you are in the right place. Below are some of the best pieces I've read on the topic. https://alphaarchitect.com/2019/06/trend-following-the-epitome-of-no-pain-no-gain/#:~:text=One%20of%20the%20recurring%20themes,them%20%E2%80%9Clike%20grim%20death.%E2%80%9D (Trend Following: The Epitome of No Pain, No Gain) http://econompicdata.blogspot.com/2018/01/the-behavioral-and-performance-benefits.html (The Behavioral and Performance Benefits of Trend Following) https://deliverypdf.ssrn.com/delivery.php?ID=475067021089026022014020031023121005125033039077095007109009099022025024089069088027011106020047055036105026065127025073075096098057087032023085002064102009125004093008032002090027007095065102003122082003017113026088108064001066126010109095122084072&EXT=pdf&INDEX=TRUE (A Quantitative Approach to Tactical Asset Allocation) https://deliverypdf.ssrn.com/delivery.php?ID=295096073027112078078086117099112107055064063038093061070012095027072096081002112023041124051002057017044100127071091029098031017010070089022092088081116031085072035047004004109027000001095099025026020084018112118119114021028115119006076028067064096&EXT=pdf&INDEX=TRUE (Learning to Play Offense and Defense: Combining Value and Momentum from the Bottom Up, and the Top Down) https://alphaarchitect.com/2020/04/trend-following-is-everywhere/ (Trend Following is Everywhere) https://www.nber.org/system/files/working_papers/w21700/w21700.pdf (MOMENTUM IN IMPERIAL RUSSIA) Our Sponsors https://www.veterinariansuccesspodcast.com/guardianvets (GuardianVets) (be sure if you reach out to mention us for 50% off your first month) https://www.veterinariansuccesspodcast.com/vetcheck-pet (VetCheck Pet Urgent Care Center Franchise)