SI150: Extracting Edges from the Market ft. Richard Brennan

This week, Richard Brennan from ATS Trading Solutions makes his debut on the show, and we discuss the complexity behind successful Trend Following strategies, momentum trading versus Trend Following, the importance of average win rate, how a weak edge can still lead to strong returns, deflationary environments and their past effects on the Trend Following models, which markets, and how many, to include in a profitable trading system, and how to find the perfect exit strategy with minimum risk.

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

In this episode, we discuss:

• Why there may be no such thing as a 'simple' successful Trend Following strategy
• How to profit across multiple timeframes
• How momentum investing is often confused with Trend Following methods
• Average win rate versus average loss rate
• Why inflation is usually a good thing for systematic investors
• Trailing stops and risk management
• How many markets are ideal for a profitable Trend Following system

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Episode TimeStamps:

00:00 – Intro

01:31 – A huge thank you to listeners of the show for leaving your 5-star reviews on iTunes

02:18 – Macro recap from Niels

04:23 – Weekly review of performance

10:24 – Q1; Kushro: Is there a way for the novice rules-based investor to reliably backtest their rules?

12:40 – Q2 & Q3; Danny: Can you give an example of how to trade multiple timeframes? How do I manage risk from unrealised profits & losses?

23:35 – Extracting an edge from markets

42:22 – Analysing win/loss rates

52:00 – Stops and position sizing

56:42 – Benchmark performance update

57:45 – Some big announcements

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2. Daily Trend Barometer and Market Score

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