I agree and restrictions on when you can withdraw your capital are also issues with a managed account. It is painful though when your cash earns a whopping 0.8% in a "HIGH YIELD" account! Of course, the Fed wants your capital to seek out the premium returns and stimulate the economy. Unfortunately, generating that premium return is tough to do without severe risk of losing the principal. It all goes back to the basic tenets of economics - there ain't no such thing as a free lunch ... at least not for most of us.
Trend following fails to beat index
- Thread starter marketsurfer
- Start date
I'm a big believer in asset allocation. When I started trading forex I realized that a big oversight on my part was a currency component to my overall asset allocation. I don't see how any conservative money manager can now allocate without at least some component of currency risk. We never use to have to think about this back in the old days. As long as we were making dollars that was cool.
brilliant insight, oldtime..You continue to impress me---
Not condescending--- sorry if it came across that way. what kind of advice other than stay away from trend funds and trend following in general, are you seeking? Here is a tidbit to get you started on the right road:
http://www.tradingmarkets.com/stock...ade-with-the-2-period-rsi-part-1-1581007.html
surf
Most good trend follower/CTAs include counter trend strategies along with pure trend following strategies. Many also implement their strategies over multiple time frames....short, medium and long-term.
My personal experience is that counter trend strategies take a faster trigger and a better trading acumen to run properly and to consistently generate alpha.
I have read through all the posts and think you guys are being too hard on trend followers. Yes, they (we...since I am one) have struggled over the past few years, but never before in history have we had so much market interference from Central Banks or Politicians.
Also any basic review of trend following would show we hang in there in bull phases and do really really well in bear phases. We are now 5 years into a bull phase. The average bull period is 3-4 years. My guess is next year is our year.
On whether you should time trend followers, I would say NO. It is best to build a portfolio that mixes trend following with other strategies, such as buy and hold. At my firm we do this and it provided better overall returns and less volatility of return.
So trend following is far from dead, in fact, we are very close to the time you will want money with a trend follower.
On Mr Henry and his fund. It got too big. No one can nimbly invest that much money! Pure greed is what happened to him!
Jeff
Also any basic review of trend following would show we hang in there in bull phases and do really really well in bear phases. We are now 5 years into a bull phase. The average bull period is 3-4 years. My guess is next year is our year.
On whether you should time trend followers, I would say NO. It is best to build a portfolio that mixes trend following with other strategies, such as buy and hold. At my firm we do this and it provided better overall returns and less volatility of return.
So trend following is far from dead, in fact, we are very close to the time you will want money with a trend follower.
On Mr Henry and his fund. It got too big. No one can nimbly invest that much money! Pure greed is what happened to him!
Jeff
Surf proves again the opposite what he tried to prove:
Logically speaking, that means shit. That could mean he was unable to identify correctly the trend or there was no trend. It is not a proof against trend following as a general conclusion.
Not to mention that would be a statistical sample of one. Trust me, I am an internet professor....
Actually, it is a PROOF for trend following. After all, it worked for him between 1984-2004 and 2007-2010. Thus you have just proved that trend following has worked for 24 years in the last 28 years.
Sounds good to me...
Logically speaking, that means shit. That could mean he was unable to identify correctly the trend or there was no trend. It is not a proof against trend following as a general conclusion.
Not to mention that would be a statistical sample of one. Trust me, I am an internet professor....
Actually, it is a PROOF for trend following. After all, it worked for him between 1984-2004 and 2007-2010. Thus you have just proved that trend following has worked for 24 years in the last 28 years.
Sounds good to me...