The Philosophy of Trend Following

Abstract

We have come across many questions from people regarding trend following. To a lay person this is shrouded in mystery and often confused with prediction methods, which are regarded as dubious rightly so. How are you able to predict anything with confidence especially if it’s a highly complex system where there are no governing equations, even if it is deterministic we know from mathematics that a system can be chaotic. Here we discuss trend following which is on the contrary rather a determination method than a prediction method. It is actually a method that is common sense and we use it daily in our lives surprisingly. Here we want to discuss the ‘philosophy of trend following’.

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