Do You Need to Be a PHD to Trend Follow & Trade for a Living?

I am at a fantastic investment conference in Miami Beach this week, the Alphametrix. I am there to find and meet face to face commodity trading advisors I am interested in. I have been trend following my own programs for now 18 years however I feel it is important element to diversify with other commodity trading advisors in order to smooth out my returns.

I was shocked when I met fellow commodity trading advisors and was asked if I was a PHD. There are many PHDs at this conference. Not being too cynical I said yes, however not in the context they thought. I said I am Passionate, Hungry and Driven.

One does not need to be a math genius to be a trend follower. I surely am not. I have a robust methodology that is on par with many of the biggest CTAs here. There are years I have outperformed and years I have under performed. However over long periods of time our results are similar.

The anti thesis of a PHD is my role model the ” Dentist” who compounded $200,000 with a simple robust idea from 1979 to today approx $17,000,000. His defining attribute was that he had the correct mental framework to get through the inherent draw downs and long periods of non profitability. Contrary to a PHD who might be much smarter, if they do not have the mental fortitude to get through all of these rough periods they will not be able to compound money over time. It is more important being patient and disciplined.

It is a given you need a robust methodology and heavy risk management to deal with all the uncertainty. Trend following is not easy and is not for everyone.

You do not need to be a PHD in order to succeed in trend following or compounding money!
Be Passionate, Hungry and Driven!

I will be very shortly teaching students exactly how I trade for a living. It too is not the Holy Grail. You will learn how to think like a trend follower as well as will give you the exact ideas. There is nothing to hide. Richard Donchian’s trading was very simple and well known, yet very few have emulated his success. If you want to learn how to trade for a living, I invite you to be one of my students.

PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. THE RISK OF LOSS IN TRADING COMMODITY FUTURES, OPTIONS, AND FOREIGN EXCHANGE (”FOREX”) IS SUBSTANTIAL.