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Ep. 158: Simple Heuristics with Michael Covel on Trend Following Radio

Ep. 158: Simple Heuristics with Michael Covel on Trend Following Radio

FromMichael Covel's Trend Following


Ep. 158: Simple Heuristics with Michael Covel on Trend Following Radio

FromMichael Covel's Trend Following

ratings:
Length:
38 minutes
Released:
Sep 19, 2013
Format:
Podcast episode

Description

Today on the podcast, Michael Covel discusses certainty and uncertainty. When it comes to tomorrow, Covel is majorly uncertain. He doesn't know what's going to happen. He can think of the worst case scenarios, though; a Stoic tradition. Many people today figure the crisis of '08 was a few years back, the Fed has everything figured out, and the stock market is at all time highs. There's nothing to be worried about. Covel reads several quotes to start off the podcast, from Gilda Radner and Richard P. Feynman. Covel questions why most investors don't think like this, and notes that 59% of US investors believe the markets can be predicted. Covel discusses the trend following mindset in contrast, and moves on to talk about Ray Dalio and his 100% systematic trading strategy based on fundamentals. But how do you know when you have enough fundamental data to make a decision? How do you account for the remaining uncertainty? Covel explores. Next, Covel talks about using simple heuristics to make decisions. The simplest factor to follow is the price. That's the only thing you can be certain about. So if you can make decisions off price movement, and use that as a simple heuristic for your buying and selling decisions, you might have something that works for dealing with market uncertainty. From a trend following perspective, simple heuristics is all about trading the price. Free DVD: www.trendfollowing.com/win.
Released:
Sep 19, 2013
Format:
Podcast episode

Titles in the series (100)

Bestselling author Michael Covel is the host of Trend Following Radio with 9.5+ million listens. Investments, economics, psychology, politics, decision-making, human behavior, entrepreneurship and trading -- all passionately explored and debated. Guests include Nobel Prize winners: Robert Aumann, Angus Deaton, Daniel Kahneman, Oliver Hart, Harry Markowitz & Vernon Smith. More guests: Jack Canfield, Howard Marks, James Altucher, Dan Ariely, Jean-Philippe Bouchaud, Kathleen Eisenhardt, Marc Faber, Tim Ferriss, Jason Fried, Gerd Gigerenzer, Larry Hite, Sally Hogshead, Ryan Holiday, Jack Horner, Ewan Kirk, Steven Kotler, Michael Mauboussin, Tucker Max, Barry Ritholtz, Jim Rogers, Jack Schwager, Ed Seykota, Philip Tetlock & Walter Williams. 900+ episodes.