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CME Group

111 The Systematic Investor Series ft Michael Covel – October 25th, 2020

Legendary Trend Following author & podcast host, Michael Covel, joins us today to discuss the far-reaching popularity of his books, the advantages of allocating to a Trend Following manager rather than DIY trading, managing money for clients vs being an unknown successful private trader, why Trend Following funds should worry about AUM growing to be too large, why Trend Following still deserves an important allocation to any investment portfolio after recent mediocre returns, and whether central bank Quantitive Easing programs have changed the landscape for systematic investors.

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Episode Summary

0:00 - Intro
1:04 - Weekly review of returns
10:17 - Moritz: Do you have any new books in the making?
13:07 - Announcement of Jack Schwager joining us on the show in 2 week’s time
13:16 - Moritz: How is your personal trading going?
16:00 - Listener question; Saeed: Which market sectors have the longest trends?
28:50 - Moritz: Do you think Trend Following is over-crowded?
29:49 - Niels: Is Trend Following’s mediocre performance over the last 10 years a new normal or an anomaly?
30:38 - Niels: What are your thoughts on pure Trend Following versus multi-strategy?
33:27 - Niels: How have institutional investors’ attitudes to Trend Following changed over the past 20 years?
38:24 - Niels: What do you say to those who ask, ‘has quantitive easing killed Trend Following’?
41:32 - Niels: What about those who say, ‘fast moving markets have killed Trend Following’?
43:34 - Niels: What do you think about managers overriding their systems during high-volatility periods?
47:45 - Niels: What are your thoughts on AI strategies?
54:10 - Niels: How do you feel about the Trend Following being labelled as ‘crisis alpha’?
1:00:30 - Performance recap
1:01:30 - Recommended podcast listening this week: Robert Rosenberg on Bloomberg’s Business Week podcast, Michael Green on The Investor's Podcast & Naval Ravikant on the Tim Ferris podcast

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