This week, Richard Brennan joins us on the show to discuss how people can benefit from the effects of compounding while others end up a paying a price for it. We also cover some thoughts on ‘path dependency,' why those invested in stocks should diversify using Trend Following strategies, why stable returns can only be correctly judged over long time periods, how to analyse fund performance without being influenced by the effects of compounding, some thoughts on what is known as ‘geometric returns’, and we explain the term ‘ergodicity’.
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In this episode, we discuss:
How to stay on the right side of the effects of compounding
How many strategies can be limited by the make-up of their previous versions
The profitable & negative correlation of Trend Following to equities when stocks are falling
The need to zoom-out when judging performance
The terms 'ergodicity' and 'path dependency'

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Follow Niels on https://twitter.com/toptraderslive (Twitter), https://www.linkedin.com/in/nielskaastruplarsen (LinkedIn), https://www.youtube.com/user/toptraderslive (YouTube) or via the https://www.toptradersunplugged.com/ (TTU website).
IT’s TRUE ? – most CIO’s read 50+ books each year – get your FREE copy of the Ultimate Guide to the Best Investment Books ever written https://www.toptradersunplugged.com/Ultimate (here).
And you can get a free copy of my latest book “The Many Flavors of Trend Following” https://www.toptradersunplugged.com/flavor (here).
Learn more about the Trend Barometer https://www.toptradersunplugged.com/resources/market-trends/ (here).
Send your questions to info@toptradersunplugged.com
And please share this episode with a like-minded friend and leave an honest Rating & Review on https://www.toptradersunplugged.com/reviewttu (iTunes) or https://open.spotify.com/show/2OnOvLbIV3AttbFLxuoaBW (Spotify) so more people can discover the podcast.
Follow Rich on https://twitter.com/RichB118 (Twitter).
Episode TimeStamps:
00:00 – Intro
01:37 – A Thank you to Shane, our website developer, for his great work in creating the new https://www.toptradersunplugged.com (Top Traders Unplugged website). We hope you all enjoy the new user interface
02:09 – A huge thank you to listeners of the show, such as Dave W, for leaving your 5-star reviews on iTunes, and feel free to share this link with 3 of your like-minded friends: https://top-traders-unplugged.captivate.fm/listen (https://top-traders-unplugged.captivate.fm/listen)

03:02 – Macro recap from Niels
04:34 – Weekly review of performance
12:04 – Making money to make money, and some insights on the compounding returns
40:50 – How to judge different strategies accurately 
44:04 – Explaining the term ‘ergodicity’
52:17 – The diversifying features of Trend Following and their negative correlation to stocks during market downturns
01:01:24 – Benchmark performance update
Copyright © 2022 – CMC AG – All Rights Reserved
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PLUS: Whenever you're ready... here are 3 ways I can help you in your investment Journey:
1. eBooks that cover key topics that you need to know about
In my eBooks, I put together some key discoveries and things I have learnt during the more than 3 decades I have worked in the Trend Following industry, which I hope you will find useful. https://www.toptradersunplugged.com/resources/ebooks/ (Click Here)
2. Daily Trend Barometer and Market Score
One of the things I’m really proud of, is the fact that I have managed to published the Trend Barometer and Market Score each day for more than a decade...as these tools are really good at describing the environment for trend following managers as well as giving insights into the general positioning of a trend following strategy! https://www.toptradersunplugged.com/resources/market-trends/ (Click Here)
3. Other Resources that can help you
And if you are hungry for more useful resources from the trend...