There are a lot of people out there who would rather fight trends than take advantage of the ones that are already in place. The idea is they are always looking for the reversion to the mean. And while some think prices always come back to the mean, it’s often forgotten that the mean can also catch up (or down) to price. I learned this lesson the hard way in 2013 and it has served me well ever since. This episode is short and sweet but I think adds a tremendous amount of value.
When I asked Phil to comment on the subject, he said, “Give me someone who can adapt, someone who is flexible over someone who is a rocket scientist any day because I can teach him to ignore that voice inside his head telling him that breakouts must revert.
The mean reversion heuristic is just one more example of how conventional thinking styles, that come hard wired in most of us and which serve us just fine in most environments, require suspension in the trading turret.”
This week on the podcast I’m thrilled to have Quint Tatro join me as our guest. I’ve been following his work for a long time and have always appreciated his technical approach to managing portfolios at his advisory firm Joule Financial. This was a great conversation where Quint walks us through how he got to Technical Analysis in the first place and how he applies those methods on a daily basis. We went over the overall stock market and how he wants to overweight International Stocks and Emerging markets heading into 2020. He also likes Gold bigger picture here and the mining stocks that come a long with it. I really enjoyed this one. Give it a listen!
In this special episode of The Money Game, Phil asks me about any new trends I’m seeing for 2020. I give him both the sexy answer, that everyone seems to want to hear, and the real answer. I think this was a quick but valuable conversation about US and foreign markets, US Sectors like Technology and Financials and even what we see coming for Bitcoin. We had good timing on this conversation as we’re just getting starting the new year.
Annie Duke is the author of one of my favorite books, “Thinking In Bets”. I often find myself recommending it to both colleagues and friends and family who aren’t even in our business. While the book might be written by a poker player, and is somewhat about poker, it’s really about the way we think, and this applies to market participation, but also life in general. It’s a book I believe everyone should read, at least once.
In this podcast episode, I asked Annie about the differences between being humble in the face of the game we’re playing vs being humble in the face of your opponent. This is a really important concept that really helps put things in perspective.
Behavioral Finance in general, as my friend Phil Pearlman puts it, is very descriptive in nature. We are quick to judge and describe, while prescriptive models, at least in this field, have taken a back seat. So Annie provides a few different things we can do to continue to improve and become more self-aware. She says that there is no “cure”, but even incremental improvements can compound over time. She is also coming out with a new book in September of 2020 that you can pre-order here: “How To Decide: Simple Tools For Making Better Choices”. She says this is also prescriptive because of the workbook portion that is included
This was a really amazing conversation that could have gone on for hours and hours. This is her favorite topic to talk about and it’s certainly near the top of my personal list. But we got through a lot of material in a short period of time, so definitely make sure to give this one a listen!
I want to thank Annie Duke for being a guest on the podcast. This one really meant a lot to me! I hope you enjoy our conversation as much as I did.
We just got back from 6 days in India and I think it will add some value to give you some perspective on the kinds of things we learned. Sean McLaughlin is our Chief Options Strategist and had never been to Asia before. This was an eye opening experience for him and one that reiterated a lot of important things I noticed in my prior visits to Mumbai. We attended a CMT Conference, we filmed a documentary on Indian Options Trading, we ate some of the best food this planet has to offer, we hung out with some of the nicest and coolest people know and got to learn a ton from everything around us. I love going to Mumbai and it’s so nice to see the rest of the gang enjoyed their time there as well. I always feel so welcomed by everyone. I can’t wait to go back! I hope this podcast helps shed some light on how much we enjoyed the trip and maybe that encourages you to make the voyage out there soon as well!
Neil Blalock is my guest this week on the podcast. I believe he is absolutely the perfect compliment to all of the other guests we’ve had on over the years. While many technical analysis, especially on this podcast, come from an equities background, Neil was raised in Missouri and brought up with commodities all around him. It wasn’t until much later in his career that he focused more on the stock market. Because Technical Analysis can be applied to asset classes of all kinds, Neil is able to use his expertise across markets. What’s funny is that you can take Neil out of the farm, but you can’t take the farm away from him completely. When I asked him about what interests him out there, he went right for the Soybean Markets! Neil just can’t help himself and it’s a beauty to watch. In this episode we dive into the agriculture commodities market as well as the softs, precious metals and ultimately into the equities and interest rate markets. This was a really fun conversation with a different perspective than what you might be used to!