TRENDS ARE INTERESTING, powerful, while at the same time, perplexing critters.We all know that “the trend is your friend.” That being the case, why don’t we all make big buckets of money from market trends? There are several explanations of why not. Some investors don’t put much effort into identifying trends. They simply buy or sell based on the advice and tips from others, follow a buy and hold philosophy or dollar-cost-averaging strategy, or because they otherwise don’t see the value in trend-following.
It’s not always easy to identify a trend, and as a result people invest with the trend rather late in the game, missing much of the profit potential. This is a problem on the other side as well, since by the time it’s clear that a trend has ended, one may well have given back much of the profits previously made.
The related issue is that, since getting in and out ... Log in or subscribe to continue reading.