Ep. 599: Trend Following Insights and Lessons with Michael Covel on Trend Following Radio
Michael Covel's Trend Following
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The Illusion of Control in Investing
Daniel Kahneman attributed market manias to investors' illusion of control. He studied the intellectual underpinnings of investing, how traders estimate odds and calculate risks. An experiment with a $10 theater ticket demonstrates the irrationality of sunk costs. Trend following by design knows if you don't cut your losses, loss will grow like a cancer.
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Transcript
