Against one of the most challenging economic backdrops in several decades, trend following strategies delivered substantial profits to their investors last year, for the most part. Unsurprisingly, this has generated a rising tide of interest from a new cohort of investors — many of whom started their careers post the Global Financial Crisis (GFC) of 2008.
While Trend is currently “trendy”, the time-tested strategy has ably navigated a multitude of economic environments over the last five decades. The post-GFC, pre-pandemic, QE-dominated 2010-2018 period has been the outlier in offering fewer opportunities. Regardless of performance, the key properties endure, cementing Trend as: adaptive (can handle a wide range of economic scenarios), agile (as markets change, its positions change) and resilient (won’t double-down on losing positions).
