Trend-Following: Theory, Expectations and Reality, Special Presentation | Arthur Hill, CMT (11.6.21)

Trend-following is a systematic and rules-based strategy for trading in the direction of the underlying trend. Trend-following strategies originated in the commodity markets and benefited from broad diversification. These strategies can also be applied to stocks, however, some adjustments are needed to improve robustness and limit draw-downs. This special edition of Next Level Charting will cover the theory behind trend-following, back-test some classic indicators, set realistic expectations and show some techniques to improve performance when focused on stocks.
00:00 - Introduction
02:00 - A Little About Me
04:16 - My Trading Style: Systematic and Discretionary
06:02 - Agenda of Presentation
07:07 - Key Assumptions and Characteristics
09:14 - Trend Following vs. Mean Reversion
11:36 - Time Frame Considerations
13:45 - Trend Following Indicators and Signals (MA Crossovers, Bollinger Bands, Keltner Channels)
24:49 - Expectations vs. Reality (Equity curve based on a system over 20-year period)
27:15 - Back-testing the Indicators
36:25 - Broad Market Timing: Market Regime Matters
44:25 - Expectations vs. Reality: Keeping it Real
47:04 - Key Takeaways and Next Steps
54:04 - Questions: Do you prefer exponential or simple moving averages?
CONNECT WITH ARTHUR
Website: trendinvestorpro.com/
Blog: stockcharts.com/articles/arth...
/ arthurhill
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DISCLAIMER
Past performance is not indicative of future results. Neither the Show Participants
nor StockCharts.com guarantee any specific outcome or profit. You should be aware of the real
risk of loss in following any strategy or investment discussed on the show.
Strategies or investments discussed may fluctuate in price or value.
Investments or strategies mentioned in this show may not be suitable for you and
you should make your own independent decision regarding them. This material
does not take into account your particular investment objectives, financial situation
or needs and is not intended as recommendations appropriate for you.
You should strongly consider seeking advice from your own investment advisor

[@stevenp17]

Arthur Hill and Trend Investor Pro has taken me from a Beginner not knowing when to - to an active trader investor. I never miss Arthur

[@nannekingma1965]

thx a lot, I will use it. One question, why didn't you backtesr sma 10 crossing sma 200. I think that is also interesting.

[@stephenbamford]

Thanks for sharing. It occurs to me that another important take-away from this amazing presentation is the complexity of determining just what goes into a performance kind of analysis. There are likely many such analyses out there. This one looks very well thought out and looks as though all the rigors of replication can be applied. Looks like a great system. The amount of work going into this analysis of a system is staggering. Well done! And thanks again.

[@davidpurser4938]

Thanks for clarifying the differences between trend following and mean reversion, and for explaining how you used back-testing to refine your charts to maximize gains and minimize losses.

[@replyxf]

Awesome video I decided to become a member of your service I really like you style

[@1309gsk]

did u do any 5/13 period cross test and studied the results?

[@glasgow757]

Really appreciate you taking the time to do this Arthur. What do you think is the best package to backtest idea's on...? thanks Al

[@davidburcham7951]

Great Job and info! Maybe sometime you can go over more advance Strats? Really love the stock charts channel.

[@jays9870]

Thanks for doing this presentation

[@peterpayne2219]

Great video, been waiting for this!

[@jean-marcducommun8185]

Excellent work Arthur! I'm very much into structured approaches to time the market because I believe it's the only way to control emotions, stay objective and limit risk. Obviously WSt doesn't like market timing because money on the sidelines doesn't create commissions but I like it and all people at my age should like it because nobody can afford to loose 50% of their assets, even 20% it hard to swallow. Most investors don't realise the psychological factor and the risk of panic reaction that a Bear market can cause. I been through many already and know what it means. Wonder how few follow your excellent work ...