Commodity Trading & Trend Following

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As most trend followers know, we are going through a tough period.However there are always tough periods. 2005 and 2006 were tough. As Ed Seykota is one of the founding fathers of trend following, I reread his Market Wizards interview with Jack Schwager often. Today I wanted to share Ed Seykota’s thoughts.
Ed Seykota does not [...]

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 [...]

You can pick the markets and your time frame when you trend follow. When you trend follow one of the biggest issues is
Trade you Personality…
Do not take my word for it..

Ed Seykota, Market Wizards
“Systems don’t need to be changed. The trick is for a trader to develop a system with which he is compatible.”
PAST [...]

Ed Seykota Quote 1:
“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.”
Ed Seykota Quote 2:
“Fundamentals that you read about are typically useless as the market has already discounted the price, and I call them “funny-mentals”. However, if [...]

AHA…I have your interest…You are looking for the secret sauce or holy grail. Well, there is no secret sauce or holy grail. Trend following is hard work. It sounds much more impressive than it really is, a “proprietary trading algorithm”.
I had this question posed to me regarding the trend following methodology that I use [...]

The psychology of risk in commodity trading is not that often of an issue discussed. I want to share an interview with my colleague Martin Bedick.
Martin Bedick
on the
Psychology of
Risk in Trading

AJ: Martin, one of your main interests has been the psychology involved in commodity trading. What is it about this areas that interest you?
MB: You [...]

There are many reasons commodity traders or even stock market investors fail.
Read this email that was sent to me. This is an example of one of the main reasons for failure.
Remember the charts condense all the economic, political and emotional expectations. And yes, every stock market movement is geared solely by expectations, not the [...]

For any of those contemplating investing in the commodity markets, they need to be very aware that losses are part of the game. As Ed Seykota has taught so many commodity and forex traders… losses are like breathing. They can not be avoided. If you are not having losses..either you are not trading.. or you [...]