Trend Following

Trend Following

Parent Strategy

Trend Following is a type of momentum strategy

  • Also known as Time-Series or Absolute¬†
  • Formula:
    • Ask the following question: Is the current price higher than it was at some defined point in the past
    • If the answer is yes, then buy it
    • If the answer is no, then sell it, short it or do nothing (if you don't own it)
  • Have the benefit of being able to prosper in both bull and bear markets (can follow the trend up or down)