Dancing with the Trend

September 2018

Dancing with the Trend

Building a Rules-Based Trend Following Model - 14

by Greg Morris

I spent a great deal of time working on an asset commitment model using the Chande Trend Meter (CTM) and believe I have something worth sharing.  Tushar defines ranges for CTM based on the degree of trendiness and I have assigned Asset Commitment percentages to those pre-defined ranges.  Table A shows the asset commitment levels for the ranges used by CTM. Table A Chart A shows the Nasdaq in black, the CTM in blue and the digital asset commitment in green.  This chart is for the period that encompassed the bear market from 2007 – Read More 

Dancing with the Trend

"Believable" Misinformation Is a Danger to Long-Term Retirement Goals

by Greg Morris

Many investment "truths" seem to go unchallenged but are in fact, very clearly just myths.  Buy and hold investing is a good long-term strategy, economists are good at predicting the markets, diversification will protect you from losses, compounding is the eighth wonder of the world, missing the best days each year can be devastating, probability and risk are the same thing, and chasing performance will work; just to mention a few.  It is important to debunk these myths. Buy and hold is a proven strategy for the stock market. The 1976 Ibbotson Read More 

Dancing with the Trend

Weight of the Evidence - 3

by Greg Morris

In the past two articles on Weight of the Evidence my goal was to show you how you can use Tushar Chande’s Chande Trend Meter (CTM) in a trend model.  I stated previously that my digital weight of the evidence also provides levels that define buying parameters, stop loss percentages, and asset commitment amounts (see this article).  In Weight of the Evidence -2 I showed that by exponentially smoothing CTM it greatly reduced its volatility and made it a bit more useable for a model.  From a ChartSchool article on CTM, Tushar provides his levels that offer degrees of Read More