Product Description

“Michael Covel’s Trend Following: Essential.”

--Ed Seykota, trend follower for 35 years and original Market Wizard

“A mandatory reference for anyone serious about alternative investments.”

--Jon Sundt, president and CEO, Altergris

“Michael Covel does an excellent job of educating his readers about the little-known opportunities available to them through one of the proven best hedge fund strategies. This book is like gold to any smart investor.”

--Christian Baha, founder and owner, Superfund

“Covel has created a very rare thing--a well documented and thoroughly researched book on trend following that is also well written and easy to read. This is one book that traders at all levels will find of real value.”

--John Mauldin, Thoughts from the Frontline

The Investment Strategy That Keeps on Making Money While Everyone Else Is Losing It:
How Trend Followers Made a Fortune During the 2008 Stock Market Crash

Did your buy and hold investments survive the crash of 2008? While many were getting hammered, trend followers were earning profits ranging all the way up to +40% for the month of October 2008 alone!

Now, the #1 guide to trend following has been thoroughly updated to reflect 2008’s cataclysmic events. Michael W. Covel reveals exactly how the trend followers achieved those amazing results. Using simple, up-to-the-minute charts from top traders, he doesn’t just prove this strategy works: He shows why only a technical system based on following price trends can win over the long term.

Best of all, he shows you exactly how to apply the same strategies in your own portfolio--so you, too, can keep on profiting no matter what happens next!

For more than 30 years, trend following has been the one trading strategy that’s consistently delivered extraordinary profits in bull and bear markets. While most investors were losing a fortune in the 2008 stock market collapse, stuck in buy and hold investments, trend followers were earning huge profits...up to a whopping +40% in the single month of October 2008! The proof’s in this book: brand-new data you can view for yourself, plus all the information you need to know to utilize the same timeless strategies in your portfolio.

In this fully updated edition, trend following expert Michael Covel introduces the traders and fund managers who’ve been using this strategy for decades, adding brand-new profiles such as David Harding, who manages $10 billion plus dollars through his London-based trend following firm. Then, Covel walks you through all the concepts and techniques you need to use trend following yourself. One step at a time, one simple chart at a time, you’ll learn how to understand price movements well enough to profit from them consistently--in any market.

Today, you need trend following more than ever. Read this book, and put it to work for you!

• Real proof, real data, real results
  Includes over a decade of detailed performance charts, updated to include the Fall 2008 market crash
• All the Information You Need...in One Number
  Why the market price still tells you all you need to know to trade--and always will--in both bull and bear markets
• Pinpointing Targets of Opportunity
  What to trade, when to trade, and how much to trade
• Meet Today's Leading Trend Followers
  Extraordinary trader profiles, from David Harding to John W. Henry to Ed Seykota

Foreword by Larry Hite     xiii

Preface     xvii

Part I

1          Trend Following     3

2          Great Trend Followers     27

Part II

3          Performance Data     97

4          Big Events, Crashes, and Panics     123

5          Baseball: Thinking Outside the Batter's Box     181

Part III

6          Human Behavior     193

7          Decision Making     211

8          Science of Trading     221

9          Holy Grails     231

Part IV

10        Trading Systems     247

11        The Game     277

Afterword     285

Foreword to the First Edition by Charles Faulkner     299

Appendices

Introduction to Appendices     305

A          Trend Following for Stocks     307

B          Performance Guide     347

C         Short-Term Trading     375

D         Personality Traits of Successful Traders     377

E          Trend Following Models     381

F          Trading System Example from Mechanica     385

G         Critical Questions for Trading Systems     395

Resources     397

Endnotes     399

Bibliography     423

Index     431

Product Details

• Amazon Sales Rank: #50626 in Books
• Published on: 2009-03-26
• Original language: English
• Number of items: 1
• Binding: Paperback
• 464 pages

From the Back Cover

“Michael Covel’s Trend Following: Essential.”

--Ed Seykota, trend follower for 35 years and original Market Wizard

“A mandatory reference for anyone serious about alternative investments.”

--Jon Sundt, president and CEO, Altergris

“Michael Covel does an excellent job of educating his readers about the little-known opportunities available to them through one of the proven best hedge fund strategies. This book is like gold to any smart investor.”

--Christian Baha, founder and owner, Superfund

“Covel has created a very rare thing--a well documented and thoroughly researched book on trend following that is also well written and easy to read. This is one book that traders at all levels will find of real value.”

--John Mauldin, Thoughts from the Frontline

The Investment Strategy That Keeps on Making Money While Everyone Else Is Losing It:
How Trend Followers Made a Fortune During the 2008 Stock Market Crash

Did your buy and hold investments survive the crash of 2008? While many were getting hammered, trend followers were earning profits ranging all the way up to +40% for the month of October 2008 alone!

Now, the #1 guide to trend following has been thoroughly updated to reflect 2008’s cataclysmic events. Michael W. Covel reveals exactly how the trend followers achieved those amazing results. Using simple, up-to-the-minute charts from top traders, he doesn’t just prove this strategy works: He shows why only a technical system based on following price trends can win over the long term.

Best of all, he shows you exactly how to apply the same strategies in your own portfolio--so you, too, can keep on profiting no matter what happens next!

For more than 30 years, trend following has been the one trading strategy that’s consistently delivered extraordinary profits in bull and bear markets. While most investors were losing a fortune in the 2008 stock market collapse, stuck in buy and hold investments, trend followers were earning huge profits...up to a whopping +40% in the single month of October 2008! The proof’s in this book: brand-new data you can view for yourself, plus all the information you need to know to utilize the same timeless strategies in your portfolio.

In this fully updated edition, trend following expert Michael Covel introduces the traders and fund managers who’ve been using this strategy for decades, adding brand-new profiles such as David Harding, who manages $10 billion plus dollars through his London-based trend following firm. Then, Covel walks you through all the concepts and techniques you need to use trend following yourself. One step at a time, one simple chart at a time, you’ll learn how to understand price movements well enough to profit from them consistently--in any market.

Today, you need trend following more than ever. Read this book, and put it to work for you!

• Real proof, real data, real results
  Includes over a decade of detailed performance charts, updated to include the Fall 2008 market crash
• All the Information You Need...in One Number
  Why the market price still tells you all you need to know to trade--and always will--in both bull and bear markets
• Pinpointing Targets of Opportunity
  What to trade, when to trade, and how much to trade
• Meet Today's Leading Trend Followers
  Extraordinary trader profiles, from David Harding to John W. Henry to Ed Seykota

About the Author

Michael Covel is a highly respected author, director, and entrepreneur who founded the internationally known website TurtleTrader.com in 1996. Covel’s first book was the best selling Trend Following: How Great Traders Make Millions in Up or Down Markets (FT Press April 2004 and November 2005 Expanded Edition). The book profiles great trend following traders who have won millions, if not billions, in the market. The original edition, expanded edition, and paperback edition have sold 100,000 plus copies. It is also available in German, Japanese, Chinese (complex and simplified), Korean, French, Arabic, Turkish, and Russian.

Covel’s second book The Complete TurtleTrader: The Legend, the Lessons, the Results (Collins, October 2007) is the definitive inside look at the legendary trader Richard Dennis and his student traders, ‘The Turtles.’ The book has received wide acclaim and is headed toward bestseller status. It is also available in German, Korean, and Chinese (complex and simplified).

Building off his book success, Covel wrote, directed, and produced a theatrical release documentary titled Broke: The New American Dream, built around the subject of behavioral finance, specifically investigating the 2007—2008 market crisis and crash. Face-to-face interviews with Nobel Prize winners Dr. Harry Markowitz and Dr. Vernon Smith, famed mutual fund investor Bill Miller of Legg Mason, David Harding of hedge fund Winton Capital, plus dozens of other Wall Street pros, along with average investors were conducted over 2007 and 2008. The film was shot in New York, DC, Miami, Dallas, San Diego, Baltimore, Las Vegas, Richmond, London, Tokyo, Singapore, Macau, and on a sheep farm outside of Harrisonburg, Virginia.

Not afraid of a crowd or controversy, Covel is known for engaging and provocative speeches presented to audiences from Tokyo to Paris to Macau (China) to Vienna (Austria) to Hong Kong to Dallas (US). His writings have appeared in Trader Monthly Magazine, Stocks, Futures and Options Magazine, Futures Magazine, Technical Analysis of Stocks and Commodities Magazine, TradingMarkets.com, Yahoo Finance, Market Technicians Association Newsletter, and Futures Japan Magazine. Covel has been quoted and interviewed by likes of Bloomberg Radio, Technical Analysis Magazine, Barrons, and dozens of radio

programs.

Covel can be reached directly at www.michaelcovel.com.

Customer Reviews

THE Trend Following Manifesto
I am a finance student, looking to become a full time trader. As a result of this, I have tried to read as many books on trading as possible. I find Trend Following to be one of the books that really stand out from that giant crowd.

My main reason for this feeling is the books feeling of completeness. When it comes to the subject of trend following, Michael, in a clear and concise manner, lays down the all the information you could possibly want regarding the mindset required, the techniques to use, the players that apply these techniques, and tonnes of data to back it up.

Unlike many trading books out there that simply hints at how you should approach trading, and/or gives a few vague examples of the techniques applied, Trend Following is a go-to-book which will explain in detail all the different aspects of the methodology called Trend Following.

I can speak for both myself and my friends/co-students when I say that you will have several nice a-ha-moments the next time you sit down in front of the trading screen after reading this book.

PS - If my English is weird it's because I'm from Norway.

Superb book!

COVEL'S TREND FOLLOWING: ESSENTIAL!
Before I start let me state that this book has raised some controversies. However I really like it (I own two different editions of it) and I'll explain why.

WHAT THIS BOOK IS NOT

If you are looking for the Holy Grail of trading systems and/or a complete "turn-key" trading system: look elsewhere as this is not what this book is set to achieve. It will not reveal any trading secrets; however reading this book will make you realise that this is not what is important...

TREND FOLLOWING: ESSENTIALS OF A TRADING PHILOSOPHY

It looks like Michael Covel appreciated the concept of Market Wizards from Jack Schwager and drew inspiration from it. In a clever mix, Covel managed to overlay and enrich all the foundations of trend following with great trend follower insights.

The book covers the principles of the trend following trading philosophy and its multiple aspects: discipline, drawdowns, risk and money management, behavioral biases, prediction vs. reaction, etc. It makes for a very interesting read - both instructive and interactive.

Even with an automated trading system, you have to be in agreement with the strategy philosophy. This book helps you understand the philosophy of trend following in greater detail - you can then decide whether it suits you. Additionally it can help you strengthen your belief during the inevitable low points such as drawdowns while trading a trend following system.

INSIDE TREND WIZARD MINDS: 10 YEARS OF RESEARCH

The world of trend followers is relatively discreet: barely anybody has heard of Ed Seykota or Bill Dunn - but John Meriwether opening up his third hedge fund (after blowing up his previous 2 - including LTCM!) makes it to the first page of Bloomberg and the FT.

Michael Covel has spent 10 years researching and interviewing for this book. This allowed him to get in the head of the greatest trend following traders. This results in extensive quotes/pearls of wisdon from Ed Seykota, Dave Harding, Bill Dunn, John W Henry, all the greatest Trend Following Wizards. It really gives you great insights on the way they think and how they apply their market philosophy to trend following. And this is information that is not readily available anywhere else.

NEW EDITION ADDITION

I have read both earlier and newest (post-2008) editions and I think the later version is worth it. Many references to the major events of 2008 help to put the text in the present context and add some relevancy (especially with trend followers outstanding performance during these times).

Additonally there is a new appendix covering in detail Trend Following for Stocks, which is of interest.

CONTROVERSIES

One of the main message of Trend Following (the trading philosophy and the book) is that we cannot predict. It forces society to admit that we are no as sophisticated as we think. It also points to the fact that chance might have much more to do with success of so-called "experts" rather than their "expert prediction abilities".
One such "expert trader" Victor Niederhoffer slams the book:

"I get the same sort of value from these books [Trend Following] as I do from studying the Keech cult, supernatural operators such as Uri Geller and horosope readers"

You can tell that Covel takes some pleasure describing the latest blow-up from Niederhoffer's fund in 2007 in his "Big Events" chapter.
Some people have also raised the question as to why Michael Covel primarily seems to be marketing his books and courses rather than trading for himself. Whether this is a valid point or not, this does not remove any quality from the book.

You can check and follow Michael Covel on his trend following blog to make your opinion.

IN CLOSING

I find this book very inspiring and motivating.
If you are new to trend following, this is a must-read: it will introduce you to all the basic concepts.
If you already believe in trend following, this is a must-read: it will reinforce your beliefs and motivation.
If you do not believe in trend following: this is a must-read: it is not too late to change your mind and this is the best book for it!

I have read Trend Following about 3 times now; this is a book that lives on my trading bookshelf - I know that every time I need a boost for motivation, a re-read will provide me just that.

As Larry Hite says:

"The way I see it, you have two choices - you can do what I did and work for 30-plus years, cobbling together scraps of information, seeking to create a money-making strategy, or you can spend a few days reading Covel's book and skip that three-decade learning curve."

For those wanting truth not lies
It takes a long time to accept that trading can and should be simple. The media is full of experts with conflicting stances and short term records. Do you need the latest software, expensive data feeds and real time access to fundamental data to make money? The answer is no and this book gives you all the proof and information you need to change from being a loser to becoming a winner. Unfortuantely all that anyone can do is point you towards the truth...accepting it and changing your world perspective is essentially down to you. Only you can be responsible for your own success or failure. Those who are searching for secrets need to look to the 1000's of other books out there selling you false promises.