Ep. 250: Hersh Shefrin and Arvid Hoffmann Interview with Michael Covel on Trend Following Radio
Michael Covel's Trend Following
Michael Covel
4.6 • 732 Ratings
🗓️ 21 June 2014
⏱️ 63 minutes
🧾️ Download transcript
Summary
My guests today are Hersh Shefrin and Arvid Hoffmann.
Hersh Shefrin has done pioneering work in behavioral finance and is the author of Beyond Greed and Fear.
Hoffmann is a colleague of Shefrin. He is a Professor of Finance at Maastricht University in the Netherlands.
The topic is their paper, Technical Analysis and Individual Investors.
In this episode of Trend Following Radio we discuss:
- Covel and Shefrin discuss how Shefrin came to know that behavioral finance was his path; the two-system framework; the connection to behavioral and eating disorders; the disposition effect; when emotion and reason are in conflict; "transferring your assets" vs. "selling a loss"; distinguishing between rules and discretion; how we stick with rules for ourselves given the context of our humanity; the psychological pitfalls of the 2008 financial crisis; the inevitability of market crises; Minsky and Keynes; the psychology of Keynesian economics; and human ideas surrounding uncertainty.
- With Arvid Hoffmann, Covel discusses the paper Technical Analysis and Individual Investors; the inspiration for the paper; Hoffmann's definition of technical analysis; the narrow focus of the paper to short-term trading; technical analysis and trend following; "invest as if the market was efficient", and "restrict your attempts to beat the market"
Jump in!
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I'm MICHAEL COVEL, the host of TREND FOLLOWING RADIO, and I'm proud to have delivered 10+ million podcast listens since 2012. Investments, economics, psychology, politics, decision-making, human behavior, entrepreneurship and trend following are all passionately explored and debated on my show.
To start? I'd like to give you a great piece of advice you can use in your life and trading journey… cut your losses! You will find much more about that philosophy here: https://www.trendfollowing.com/trend/
You can watch a free video here: https://www.trendfollowing.com/video/
Can't get enough of this episode? You can choose from my thousand plus episodes here: https://www.trendfollowing.com/podcast
My social media platforms:
Twitter: @covel
Facebook: @trendfollowing
LinkedIn: @covel
Instagram: @mikecovel
Hope you enjoy my never-ending podcast conversation!
Transcript
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| 0:00.0 | This is Trend Following Radio, where great thinking comes alive. |
| 0:10.9 | Nobel Prize winners, legendary traders, bestselling authors, and the pros that know what drive us irrational human beings. |
| 0:21.2 | I am your host, Michael Covel. |
| 0:24.0 | Not filtered, raw, honest. |
| 0:27.3 | That's my passion. |
| 0:33.1 | Before I get into my guest today, I would like to read a quote. |
| 0:39.4 | Fantastic quote. |
| 0:47.0 | This apparently is on the walls in the locker room, the San Antonio Spurs, in multiple languages. |
| 0:51.4 | There are many guys in their team that are speaking more than just English. |
| 0:55.9 | I love this. This is from Jacob Rees. Quote, |
| 1:01.9 | when nothing seems to help, I go back and look at the stone cutter hammering away at his rock, |
| 1:07.5 | perhaps a hundred times without as much as a crack showing in it. Yet at the hundred and first below, it will split in two. And I know it was not that blow that did it, |
| 1:12.7 | but all that had gone before. |
| 1:15.9 | End quote. |
| 1:17.9 | What a great way to sum up. |
| 1:20.6 | Good trading, good success in life, |
| 1:24.4 | sticking with it, |
| 1:26.0 | entrepreneurial energy. |
| 1:36.2 | You keep pounding. slinging that hammer, swinging it, swinging it, pounding. |
| 1:42.4 | Pounding the rock. Pounding the rock. |
| 1:44.4 | Speaking of pounding the rock, |
| 1:47.0 | one quick reminder, |
... |
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