Trend Following and Card Counting

Last week I met with Michael Covel, author and president of Trend Following, a privately owned firm specializing in trend trading research.  Michael recorded our lunch meeting as he interviewed me about my experiences with the MIT Blackjack Team. We were both struck by the similarities and connections between trend trading and card counting. Expected return, risk management and a systematic approach are just some of the strong commonalities. Michael was kind enough to give me a copy of his documentary, Broke, along with several of his books. Since our meeting I have read The Complete Turtle Trader: How 23 Novice Investors Became Overnight Millionaires.  It was a fascinating read and I hope to interview Michael myself to learn more about trend trading and how investors can best navigate the often treacherous waters of financial markets. More to come on trend trading as well as the amazing story of the Turtle Traders. Below is a link to the interview, part of Michael’s podcast.

http://trendfollowing.libsyn.com/webpage/mike-aponte-interview-trend-following-manifesto-with-michael-covel

Comments

  1. Trader Jim says:

    Hello Mike… enjoyed your interview with Mike Covel. As someone who learned to count cards in the 90s and has been trading almost as long with a trend following method I would agree about the similarities. Another similarity is that even though both are relatively simple concepts, they require a tremendous emotional discipline to use properly in the “real world”, something the average person is often unable to achieve.

  2. Hi Jim,

    You’re right about the emotional discipline. It’s one thing to know what you’re supposed to do. Most people fall short because they fail to follow through even when they know what they should do. Knowledge is the first step. Proper execution is the second. You need both to succeed.

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