Ep. 76: Jack Schwager Interview with Michael Covel on Trend Following Radio
Michael Covel's Trend Following
Michael Covel
4.6 • 732 Ratings
🗓️ 6 November 2012
⏱️ 55 minutes
🧾️ Download transcript
Summary
My guest today is Jack Schwager, a recognized industry expert in futures and hedge funds and the author of a number of widely acclaimed financial books. Schwager is one of the founders of Fund Seeder, a platform designed to find undiscovered trading talent worldwide and connect unknown successful traders with sources of investment capital. Previously, Schwager was a partner in the Fortune Group (2001-2010), a London-based hedge fund advisory firm.
The topic is his book Market Sense and Nonsense: How the Markets Really Work (and How They Don't).
In this episode of Trend Following Radio we discuss:
- How Schwager was able to make "Market Sense and Nonsense" accessible to both professionals and laymen and touch on some of the subjects contained within: market fallacies and misconceptions
- The idea of cable news "experts", and what would happen if you actually followed all of the picks made by people like Jim Cramer and other talking heads
- Comparing performance streams against each other, and why you have to consider more than just the number
- Volatility vs. risk
- If coming to a good risk adjusted return is based more on a scientific approach or personal preference
- Leveraged ETFs
- The fear of hedge funds
- The idea of leverage and why much of "Market Sense and Nonsense" was built around trying to understand it
- Why fund-to-fund managers putting a large group of trend following traders together in one portfolio might not be a wise move
- Presidential election and discuss why whoever is selected to be the next president might not make much of a difference in the markets
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
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Twitter: @covel
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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, not filtered, raw, honest. |
| 0:27.3 | That's my passion. |
| 0:33.2 | So today on the show I have Jack Schweiger, and for those that have had a pulse in the last 20 or so years and have read a few books on investments, you have surely crossed paths with Jack's prior works, the Market Wizard series. |
| 0:48.8 | And that would be the Market Wizards, the new market wizards, stock market wizards and hedge fund market wizards. |
| 0:55.9 | And today I have Jack on the show to talk about his new book, Market Sense and Nonsense. Jack, welcome today. |
| 1:01.8 | Hey, thanks, Mike. Glad to be here. So let me jump right in. Going through this book, I think, |
| 1:09.3 | trying to think the best way for me to describe it, but it's almost |
| 1:12.4 | like, I want to imagine you sat back one day and you were like, okay, what is the tried and |
| 1:18.2 | trude ways that people look at investments, look at funds, and all these basic ways they |
| 1:24.7 | look at things that have been generally accepted for 20, 30, 40 years, |
| 1:29.0 | and you were just like, okay, I'm going to slay the dragon today. This is not accurate. |
| 1:33.3 | Well, it didn't quite happen that way, although the mental processes may be similar. |
| 1:38.5 | It happened over a number of years, and I had been giving talks. Most of my talks are |
| 1:43.8 | market wizards oriented, but I gave |
| 1:45.8 | quite a few where I was talking about what I called, either investing fallacies or market |
| 1:51.2 | misconceptions or whatever. And I had various themes that I was hitting during that time. |
| 1:56.5 | And I kind of thought, you know, boy, and I got a lot of these, and some of them are very, very serious. |
| 2:02.4 | I mean, people really are wrong about a lot of very core issues. |
| 2:06.3 | And I thought it would make a good book. |
| 2:08.2 | My problem was I could never figure out how to write it in a way that was meaningful to professionals and yet accessible to laymen. |
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