Commodity Trading & Trend Following

I just returned from the Alphametrix conference in Florida. What struck me was a commodity trading advisor who now is managing in excess of $600 million dollars. When he started he only had a small trading account and to make matters worse was his first two years he was down -3% and the next year [...]

I had this question posed to me last night while meeting a potential institutional investor last night at the MFA. I know that my greatest draw down is always ahead of me as well as I tell investors & potential students there is a draw down out there that might have them stop trading.
It was [...]

I just returned from a fantastic conference in Miami Beach, The Alphametrix. It was very interesting on many levels. I was able to meet many trend followers face to face as well as I met with many commodity trading advisors that I was interested in investing with. Actually I hope to make an investment in [...]

The Equity Curve of the Stock Market with a compound annual rate of return of 0.39% over 10 years does not seem to be a way to compound money over long periods of time.

Compare this with trend following. Trend followers and commodity trading advisors go through draw downs and long periods in which they [...]

Too many new traders think they can quit their day job and start printing money. The truth could not be further. It took me many years to ” REALLY” get it.
Really get it means that any trade is 50/50 regardless of any type of analysis.
Really get it means it is ok to have [...]

Futures Magazine ran an article on how CTAs like myself took up the battle against MF Global and now JP Morgan.
Here is a short excerpt click here for the entire article.
And it is a process because CTAs are dealing with new brokers and how they should treat positions and performance. Like the initial reaction to [...]

The single biggest mistake traders make, is thinking that investing and trading is “Easy.”
They allow themselves to fall for advertisements promising, “You can get rich by trading” or “Earn all the income you’ve ever dreamed of” or “Leave your day job forever
& live off your day-trading profits.” Trend following is not retirement in a [...]

After the MF Global bankruptcy in which segregated client accounts were possibly violated many have asked me where to leave their money when they trend follow. What saved me from disaster with MF Global was that I learned many years ago from one of the commodity trading advisors in which I invested with was to [...]

Last year we saw a significant move up in cotton. When I put this trade on it was no different than any other trade. It was simply a trend breakout trade with a low risk bet. When trend following most of your trades do not work. Bearing that in mind I take risks between .5% [...]

This year has been very tough on many trend followers. It seems that many trend followers have not made money since December of 2010. Clearly there are exceptions such as Chadwick, Fort LP and Saxon however the majority including myself are having a flat year at best. The standouts on the downside are Chesapeake and [...]