SI55: Aligning your investments with the best odds and why the Sharpe needs salt

Published: Sept. 29, 2019, 8:11 p.m.

In this week\u2019s episode, we discuss why Sharpe Ratios should be taken with a pinch of salt, the benefits of using a Trading Coach, why consistently aligning with the best odds may be a better strategy than trying to predict future price moves, DUNN Capital\u2019s recent award from HedgeWeek magazine, why \u2018the standout hedge fund traders this year have been computer-driven Trend-Followers\u2019, and why Risk Management is more important than strategy or philosophy.  Questions answered this week include: Why are commodities seen as more risky than equities?  Can you use Options in a Trend Following strategy? Should you keep your stop-loss proportionately the same across different time-frames?  Are there any markets to be avoided by new managers?

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Episode TimeStamps:

00:00 \u2013 Intro

01:05 \u2013 Reading of various podcast reviews

03:00 \u2013  Macro recap from Niels

06:20 \u2013 Weekly review of performance

10:15 \u2013 Discussion of Mercer Trend Following paper

18:15 \u2013 Live event update 10/26/19-10/27/19; Special Guest: Denise Shull

20:35 \u2013 Top tweets

36:10 \u2013 Questions 1/2/3: Eric; Do you hedge with OTM options? Can you use options to trade trends? Will HFT algos negatively impact TF systems?

41:40 \u2013 Question 4: Sam; Should stop distance (ATR multiple) adjust with the trend speed?

47:50 \u2013 Question 5: Noobe; Are there any contracts a new manager should avoid?

54:20 \u2013 Question 6: Clay; With minimal trading activity, what do TF do all day?

01:00:50 \u2013 Question 7: Giangitano; Should you have...