TTU137: A new approach to Entering Trends ft. David Gorton, CIO at DG Partners
Top Traders Unplugged
Niels Kaastrup-Larsen
4.8 • 712 Ratings
🗓️ 6 March 2023
⏱️ 70 minutes
🧾️ Download transcript
Summary
Today, we are joined by David Gorton, CIO at DG Partners, for a conversation on how they use trend following to achieve a multi-billion dollar portfolio. We discuss how to become a better trend follower by understanding the weaknesses of the strategy and their approach to produce positive alpha, the challenge of timing trend following and how they focus on the conceptual trend without giving up the skew and how the "dark" 10-year period has affected their approach to volatility. We also discuss how they manage risk in an uncertain environment and the state of liquidity, whether trend following has a limit in terms of capacity and much more.
DG Partners LLP is authorised and regulated by the FCA and only provides services to professional clients as defined under the FCA rules.
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50 YEARS OF TREND FOLLOWING BOOK AND BEHIND-THE-SCENES VIDEO FOR ACCREDITED INVESTORS - CLICK HERE
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Episode Timestamps:
02:08 - Introduction to DG Partners
03:38 - Their road to trend following
12:13 - The weaknesses of trend following
16:00 - Too concerned about Sharpe?
19:10 - The dual mandate
22:51 - The trend following narrative
27:19 - Capturing the meat of trend following
30:24 - Need for speed?
38:13 - How many markets do they trade?
40:16 - Rethinking volatility?
43:01 - Their execution process
44:00 - Their view on CTA replication
47:39 - Risk management
51:36 - The state of liquidity
59:36 - The absence of pain
01:00:40 - Trend following in a broader portfolio
01:02:58 - Capacity in trend following
01:05:26 - Trend following disagreements
01:06:50 - Expectations for 2023
01:08:17 - Thanks for listening
Copyright © 2025 – CMC AG – All Rights Reserved
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PLUS: Whenever you're ready... here are 3 ways I can help you in your investment Journey:
1. eBooks that cover key topics that you need to know about
In my eBooks, I put together some key discoveries and things I have learnt during the more than 3 decades I have worked in the Trend Following industry, which I hope you will find useful. Click Here
2. Daily Trend Barometer and Market Score
One of the things I’m really proud of, is the fact that I have managed to published the Trend Barometer and Market Score each day for more than a decade...as these tools are really good at describing the environment for trend following managers as well as giving insights into the general positioning of a trend following strategy! Click Here
3. Other Resources that can help you
And if you are hungry for more useful resources from the trend following world...check out some precious resources that I have found over the years to be really valuable. Click Here
Transcript
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| 0:00.0 | We're always concerned that when markets lack direction and there isn't a fundamental driver, |
| 0:12.0 | that returns are going to be lackluster in those types of environments, and that people can, |
| 0:18.0 | you know, get bored of trend following and go back to your earlier point is that, well, |
| 0:23.6 | you had one in 08, a great year, you know, a couple of good years here and there and then another |
| 0:27.3 | ban a year, maybe we'll just wait two or three years and then they forget. |
| 0:31.6 | I think it's important that there's an allocation and a dialogue with investors down that |
| 0:36.6 | we don't, we don't slip into you know |
| 0:39.2 | at two choppy markets for too long imagine spending an hour with the world's greatest traders |
| 0:46.2 | imagine learning from their experiences their successes and their failures imagine no more |
| 0:52.7 | welcome to top traders unplugged the place where you can learn |
| 0:56.9 | from the best hedge fund managers in the world so you can take your manager, due diligence, |
| 1:01.6 | or investment career to the next level. Before we begin today's conversation, remember to |
| 1:06.5 | keep two things in mind. All the discussion we'll have about investment performance is about the past, |
| 1:11.8 | and past performance does not guarantee or even infer anything about future performance. Also understand |
| 1:17.5 | that there's a significant risk of financial loss with all investment strategies, and you need to |
| 1:22.0 | request and understand the specific risks from the investment manager about their product |
| 1:26.5 | before you make investment decisions. |
| 1:28.9 | Here's your host, veteran hedge fund manager, Niels Kostrup Larson. |
| 1:38.0 | Hey everyone and welcome to another edition of Top Traders on Pluck, where Alan Dunn and I are joined |
| 1:42.6 | today by David Gorton, founder and |
| 1:44.7 | chief investment officer of DG Partners as part of our mini-series focusing on the one investment |
| 1:49.2 | strategy that beat everything else in 2022, namely trend following and managed futures more broadly. |
... |
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