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My guest today is Tom Basso, the trend following trader famously featured in Jack Schwager's "New Market Wizards". Basso is a\xa0hedge fund manager. He was president and founder of Trendstat Capital Management. Trendstat was closed in 2003 when assets under management fell to $65M.\xa0He is the author of two books, Panic-Proof Investing and the self-published The Frustrated Investor. In 1998, he was elected to the board of the National Futures Association. He currently runs enjoytheride.world, a website dedicated to trader education. He is also the chairman of the board of Standpoint Funds.

The topic is Trend Following.

In this episode of Trend Following Radio we discuss:

• Video of philosopher Alan Watts
• How Basso manages his emotions during both losing and winning periods
• What drove Basso to "enjoy the ride" and whether there were periods in his life when it was difficult to do so
• Exit strategies on winning positions
• Basso's use of hedges
• The process behind taking a developed system from testing to live trading
• What Basso learned from his earliest large drawdown
• Basso's use of money management and risk control
• Basso's advice to the first time programmer
• How to handle skeptics of trend following
• Whether Basso considered the notion of serenity from the very beginning of his career
• The career of John W. Henry
• Basso's coin flip entry method, and the importance of exit strategies
• Percent betting
• Diversification
• What would cause Basso to stop trading a particular system
• Comfort with uncertainty
• Basso's views on initial capital at risk vs. unrealized gains
• Fighting against your gut reaction when your system tells you otherwise

Jump in!

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I\u2019m MICHAEL COVEL, the host of TREND FOLLOWING RADIO, and I\u2019m 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\u2019d like to give you a great piece of advice you can use in your life and trading journey\u2026 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\u2019t get enough of this episode? You can choose from my thousand plus episodes here: https://www.trendfollowing.com/podcast

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Hope you enjoy my never-ending podcast conversation!