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Ep. 2: Bob Pardo Interview with Michael Covel on Trend Following Radio: Michael Covel interviews Robert Pardo (of Pardo Capital Limited and author of The Evaluation and Optimization of Trading Strategies). Michael discusses with Bob some of his beginnings, his philosophies, and the idea of risk. Insights from a trader who... by Michael Covel's Trend FollowingUNLIMITED
Ep. 120: Taking, Not Trading with Michael Covel on Trend Following Radio
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Ep. 120: Taking, Not Trading with Michael Covel on Trend Following Radio
ratings:
Length:
17 minutes
Released:
May 9, 2013
Format:
Podcast episode
Description
There's no better lyric than "Life of Illusion" by Joe Walsh to describe the most recent trading performance that was reported by J.P. Morgan. In the first quarter they were profitable on 63 out of 63 trading days. Think you can develop a trading strategy that can compete with J.P. Morgan? You can't. What J.P. Morgan has done is not trading performance; it's an incestuous union between them, the United States government and the Federal Reserve. You don't make money 63 out of 63 days trading. That's not trading; it's a gift. Of course, if you have a position in J.P. Morgan, that's great; ride the trend. But what's unfortunate is that we're in the middle of a societal tsunami on Wall Street that makes it very difficult for the average person to know what's real. To the average person that wants to learn about trading, J.P. Morgan's performance looks like a noble goal. Unfortunately, this level of making money has nothing to do with a trading strategy. It has everything to do with being in a symbiotic union with the government and the Federal Reserve. It's not trading, it's taking. Can you replicate a trading strategy where you get the same advantages that J.P. Morgan does? And what happens when the black swan flies in? Covel goes on to explain comparing the performance records of Bill Dunn to J.P. Morgan. When these black swan events happen, strategies like Bill Dunn's excel, and fundamental strategies don't. It's that simple. You're left with the idea of worshiping a false idol (JP Morgan) or the Bill Dunn strategy that doesn't make money every day, but in the long haul makes more money and protects you when the tsunami hits. Covel closes by talking about the high priest himself, "Venus", the man from Omaha. Even though his fourth quarter profit rose 49% on gains tied to derivatives--derivatives that he once called "weapons of mass destruction"--it's no matter to his worshipers. Covel gives him all the credit in the world for amassing his great fortune; he's one of the greatest capitalists of all time. However, it's the disingenuous, manipulative nonsense of telling people not to trade derivatives but then doing it himself that really gets to Covel. Venus pretends that his words don't matter. Want a free trend following DVD? Go to trendfollowing.com/win.
Released:
May 9, 2013
Format:
Podcast episode
Titles in the series (100)
- 38 min listen