SI310: The Illusion of Backtests and True Drivers of Price ft. Richard Brennan

Together with Richard Brennan we address the high level of volatility we have experienced this month and what airplane turbulence can teach us about periods of volatility. We also discuss why backtesting can’t predict future performance and what can be done to achieve achieve more realistic expectations of future risk and returns. We then dive into how investor behaviour drives price movement and how trend followers play a role in this, and why it may still make sense to include highly correlated assets in your trend following portfolio and more.-----EXCEPTIONAL RESOURCE: Find Out How to Build a Safer & Better Performing Portfolio using this FREE NEW Portfolio Builder Tool-----Follow Niels on Twitter, LinkedIn, YouTube or via the TTU website.IT’s TRUE ? – most CIO’s read 50+ books each year – get your FREE copy of the Ultimate Guide to the Best Investment Books ever written here.And you can get a free copy of my latest book “Ten Reasons to Add Trend Following to Your Portfolio” here.Learn more about the Trend Barometer here.Send your questions to [email protected] please share this episode with a like-minded friend and leave an honest Rating & Review on iTunes or Spotify so more people can discover the podcast.Follow Rich on Twitter.Episode TimeStamps:01:01 - What has been on our radar recently?04:43 - What can trend followers learn from airplane turbulence?11:48 - Industry performance update18:24 - The limitations and pitfalls of relying solely on backtesting33:42 - Advice for using in- and out-of-sample data36:31 - How collective trader behaviour influences price movement48:03 - How cocoa is the perfect example of investor behaviour and price movement52:47 - Why highly correlated assets may still be beneficial to your portfolioCopyright © 2024 – CMC AG – All Rights Reserved----PLUS: Whenever you're ready... here are 3 ways I can help you in your investment Journey:1. eBooks that cover key topics that you need to know about In my eBooks, I put together some key discoveries and things I have learnt during the more than 3 decades I have worked in the...