66 min listen
Ep. 386: Expanding Your Thinking with Michael Covel on Trend Following Radio
Ep. 386: Expanding Your Thinking with Michael Covel on Trend Following Radio
ratings:
Length:
40 minutes
Released:
Oct 5, 2015
Format:
Podcast episode
Description
Today on Trend Following Radio, Michael Covel takes time out to highlight the fact that trend following isn’t simply about trading. From gamblers to pharmaceutical executives to those in the film and music industries, trend following is a strategy rooted in human nature itself.
As an example, Michael examines the success of film producer Jason Blum. In direct opposition to the Hollywood mantra of Spend! Spend! Spend!, Blum has chosen another path. Blum, recognizing that big budgets don’t necessarily mean big profits, developed a filmmaking system based on low budget projects. Blum fully understands that close to half of his films will flop. But he also understands that a handful of box office successes will more than cover those losses. This is the essence of trend following.
Michael goes on to quote from a 2005 article by best-selling author Michael Crichton. Crichton, talking about the then-burgeoning field of futurism, explains that these so-called futurists don’t actually know any more about the future than the average man on the street. These “experts” are guilty of the same flawed thinking that spews forth from the minds of traders who think they know what the market will do tomorrow.
In this episode of Trend Following Radio:
Why embracing uncertainty pays big
Trend following: it’s human nature
Losses: acceptable when you strategize to cover them
The sunk cost fallacy
Opening your mind to alternative ways of thinking
The mistake of blindly accepting the word of “authorities”
Want a FREE Trend Follwing DVD? Find it here.
As an example, Michael examines the success of film producer Jason Blum. In direct opposition to the Hollywood mantra of Spend! Spend! Spend!, Blum has chosen another path. Blum, recognizing that big budgets don’t necessarily mean big profits, developed a filmmaking system based on low budget projects. Blum fully understands that close to half of his films will flop. But he also understands that a handful of box office successes will more than cover those losses. This is the essence of trend following.
Michael goes on to quote from a 2005 article by best-selling author Michael Crichton. Crichton, talking about the then-burgeoning field of futurism, explains that these so-called futurists don’t actually know any more about the future than the average man on the street. These “experts” are guilty of the same flawed thinking that spews forth from the minds of traders who think they know what the market will do tomorrow.
In this episode of Trend Following Radio:
Why embracing uncertainty pays big
Trend following: it’s human nature
Losses: acceptable when you strategize to cover them
The sunk cost fallacy
Opening your mind to alternative ways of thinking
The mistake of blindly accepting the word of “authorities”
Want a FREE Trend Follwing DVD? Find it here.
Released:
Oct 5, 2015
Format:
Podcast episode
Titles in the series (100)
Ep. 18: Jack Schwager Interview with Michael Covel on Trend Following Radio: Michael Covel talks to writer and trader Jack Schwager, author of the Market Wizards series. Schwager's new book, Hedge Fund Market Wizards, is now out. Covel and Schwager discuss some of the commonalities between the many traders Schwager has... by Michael Covel's Trend Following