Andreas Clenow - Trend Following Is…About Taking A Lot of Bets On A Very Large Number Of Markets | #188

The Meb Faber Show - Better Investing

The Idea Farm

Investing, Management, Business

4.8 • 978 Ratings

🗓️ 20 November 2019

⏱️ 69 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

In episode 188 we welcome our guest, Andreas Clenow. Meb and Andreas start the conversation with a hat on what hooked Andreas on trend following, and his book, Following the Trend. Andreas discusses running trend following as a portfolio strategy, not something that is optimal to run on a single market. He talks about some basic fundamentals of trend following, including the premise that it’s about taking a lot of bets on a large number of markets independently. Meb then asks Andreas to get into some detail about risk management and position sizing. Andreas defines the way he thinks about risk, and goes back and forth with Meb about the reality of return expectations and compounding. Meb follows by asking what has changed with his approach over the years. Andreas responds with the idea of realizing it’s about strategy and business, and the business has changed a lot. The conversation transitions into how trend following can fit into an investment portfolio. Andreas offers that the strategy can serve as a core building block of a larger portfolio. He talks about some of the environments where trend following has done particularly well, and the challenge with diversification in equities. As the conversation winds down, Meb asks about Andreas’ new book, Trading Evolved: Anyone can Build Killer Trading Strategies in Python. Andreas describes the book as a guide for readers to build backtests and strategies in the programming language, Python. All this and more in episode 188, including Andreas’s most memorable investment. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Welcome to the Mebb favor show, where the focus is on helping you grow and preserve your wealth.
0:11.0	Join us as we discuss the craft of investing and
0:13.5	uncover new and profitable ideas all to help you grow wealthier and wiser.
0:17.2	Better investing starts here.
0:18.8	Met Faber is the co-founder and chief investment officer at Cambria Investment Management.
0:23.3	Did it industry regulations, he will not discuss any of Cambria's funds on this podcast.
0:27.2	All opinions expressed by podcast participants are solely their own opinions and do not reflect the opinion of
0:31.2	Cambria Investment Management or its affiliates.
0:33.4	For more information, visit Cambria Investments.com.
0:35.6	Hey, podcast listeners, the year is winding down. The decade is is winding down but we got a great show for you today our guest is
0:47.8	CIO of Acia's asset management based out of Zurich where he manages alternative investment funds for institutional and qualified investors.
0:55.0	He's also written a lot of books, including following the trend, diversified managed futures trading, stocks on the move,
1:02.8	and his new one.
1:03.8	Trading evolved.
1:05.2	Anyone can build killer trading strategies in Python.
1:08.4	Welcome to the show, Andreas Klinel.
1:10.1	Thanks, Matt.
1:10.9	Great to be here.
1:11.8	You know, last time I think we were hanging out would have been in New York City. I tried to take you to one of the finest Japanese restaurants and you said, no, no, no, no, meb, I'm ready for a burger. So we both had our first Shake Shack adventure and they just opened up one next door to my office now.
1:28.4	So when you come visit me in LA, we don't even have to venture out.
1:31.4	We can just go next door.
1:32.4	Sure, I'd like to have been over to California yet but yeah give me an excuse I'll be there.
	...

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