Systematic trading and Trend Following legend, Perry Kaufman, joins us on the show today to discuss the importance of being comfortable with risk, the benefits of continuously ranking & evaluating markets, the importance of ‘fat tails’ in Trend Following systems, why you might want to use equal risk with every trade, how to avoid being over-correlated, trading single stocks vs indices, opinions on profit targets, and why he generally prefers long trades vs short trades.

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50 YEARS OF TREND FOLLOWING BOOK AND BEHIND-THE-SCENES VIDEO FOR ACCREDITED INVESTORS - CLICK HERE

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Episode TimeStamps:

00:00 – Intro

01:25 – Weekly review of performance

06:08 – Niels: How does the content in your book, Trading Systems, inform your decisions when building a system, and what do they mean to you?

26:44 – Niels: How do you avoid overfitting your system to accommodate markets that may not perform well in the future?

29:28 – Niels: How do you avoid being over-correlated?

30:17 – Niels: How does your ranking system work when adding or removing markets from your trading universe?

44:19 – Niels: How do you feel about profit targets?

53:06 – Niels: Why do you believe Trend Following strategies will always be successful?

57:00 – Niels: Have you found in your research that long-sided trades tend work better than short trades, and if so, have any hypothesis as to why that is?

01:04:33 – Moritz: What are your thoughts on trading single stocks vs trading the indices?

01:09:54 – Niels question for Moritz: How have you incorporated yourself & Perry’s work on Volatility Targeting into your trading?

01:21:29 – Niels: Are there any new discoveries that you’ve found in recent years that enhance Trend Following strategies, or have we most likely found everything by now?

01:24:45 – Benchmark performance update

01:26:32 – Niels: Which book, that you didn’t write, would you recommend to our listeners?

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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. 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! Click Here

3. Other Resources that can help you

And if you are hungry for more useful resources from the trend following world...check out some precious resources that I have found over the years to be really valuable. Click Here

Disclaimer

SI109: Investing like a legend ft. Perry Kaufman

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