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.
- Trend Following: The Epitome of No Pain, No Gain
- The Behavioral and Performance Benefits of Trend Following
- A Quantitative Approach to Tactical Asset Allocation
- Learning to Play Offense and Defense: Combining Value and Momentum from the Bottom Up, and the Top Down
- Trend Following is Everywhere
- MOMENTUM IN IMPERIAL RUSSIA
GuardianVets (be sure if you reach out to mention us for 50% off your first month)