Ep. 361: Francisco Vaca Interview with Michael Covel on Trend Following Radio

Michael Covel's Trend Following

Michael Covel

Business, Investing

4.6 • 732 Ratings

🗓️ 10 July 2015

⏱️ 50 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

My guest today is Francisco Vaca. Vaca can be called a second generation turtle trader. He worked with Richard Dennis at C & D Commodities, and for the last 15 years has been closely associated with Paul Rabar. He is now the Co-Chief Investment Officer at Rabar Market Research. Before he became a trader, Vaca was a particle physicist and worked at the famous Fermi lab. This is not an insignificant fact, as his background in mathematics and statistics became very useful in his career as a trader.

The topic is Trend Following.

In this episode of Trend Following Radio we discuss:

The importance of distinguishing between long term and short term track records
"Alpha" and "beta" trading strategies
How the holding period length affects the risk-reward profile and return streaks
The benefits of diversification across different holding times
Using high frequency trading technology in long term trend following
How correlations are often misinterpreted
Knowing the limitations of your tools

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

Click on a timestamp to play from that location

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.
0:21.1	I am your host, Michael Covel, not filtered, raw, honest.
0:27.3	That's my passion.
0:32.9	I guess today is Francisco Vaca.
0:36.3	This is Francisco's second appearance on my show.
0:40.6	For those that will recall, Francisco once worked for C&D commodities out of Chicago,
0:46.2	Richard Dennis' firm.
0:48.2	Not a turtle, but worked for Richard Dennis after the Turtle program.
0:52.0	He has long had an association with Paul Rabar, one of the turtles.
0:56.2	And for many, many years, Francisco ran his own trend following trading firm.
1:03.0	Today, he is the co-chief investment officer at Rabar Market Research.
1:08.4	Again, as I just mentioned, Paul Raybar's firm.
1:13.8	Together, they run Raybar Market Research.
1:20.2	Always insightful to have Francisco on my show. I hope you enjoy this conversation.
1:36.0	I am now the COCICIO of Ravar Market Research, which is ACTA, run and founded by Paul Rabar.
1:43.6	Paul Ravar being one of the original turtles, and I guess all your audience is well familiar with the Turtles start.
1:49.4	I have known Paul for over 15 years.
1:52.5	For almost 15 years, we've been partners.
1:55.3	He ceded Vaca Capital Management,
1:59.2	my money management company in 2000.
2:07.0	And we have worked side by side, essentially pretty much at every aspect of trading throughout the years.
	...

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