Table of Contents :



Preface

Acknowledgments



Part I

Chapter 1 - Trend Following

The Market

Winning and Losing

Investor v. Trader: How Do You See the World?

Fundamental v. Technical: What Kind of Trader Are You?

Discretionary v. Mechanical: How Do You Decide?

Timeless

Has Trend Following Changed?

Trend Following Modus Operandi: Follow Price

Follow the Trend

Handling Losses

Conclusion



Chapter 2 - Great Trend Followers

Bill Dunn

John W. Henry

Ed Seykota

Keith Campbell

Jerry Parker

Salem Abraham: Texas Pioneer

Richard Dennis

Richard Donchian

Jesse Livermore and Dickson Watts



Part II

Chapter 3 - Performance Data

Absolute Returns

Fear of Volatility; Confusion with Risk

Drawdowns

Correlation

The Zero-Sum Nature of the Markets

George Soros Refutes Zero-Sum



Chapter 4 - Big Events in Trend Following

Event #1: Stock Market Bubble

Event #2: Long Term Capital Management Collapse

Event #3: Asian Contagion and Victor Niederhoffer

Event #4: Barings Bank Meltdown

Event #5: Metallgesellschaft

Final Thoughts

The Coming Storm



Chapter 5 - Baseball: Thinking Outside the Batter's Box

The Home Run

Moneyball and Billy Beane

John W. Henry Enters the Game

Pedro Stays In



Part III

Chapter 6 - Human Behavior

Prospect Theory

Emotional Intelligence: Daniel Goleman

Charles Faulkner

Ed Seykota's Trading Tribe

Curiosity Is the Answer, Not Degrees

Commitment to Habitual Success



Chapter 7 - Decision-Making

Occam's Razor

Fast and Frugal Decision-Making

The Innovator's Dilemma

Process v. Outcome



Chapter 8 - Science of Trading

Critical Thinking

Chaos Theory: Linear v. Nonlinear

Compounding



Chapter 9 - Holy Grails

Buy-and-Hold

The King of Buy-and-Hold: Warren Buffett

Losers Average Losers

Crash and Panic: Retirement Plans

Wall Street: Analysis Paralysis

Final Thoughts



Part IV

Chapter 10 - Trading Systems

Risk, Reward, and Uncertainty

The Five Questions for a Trading System

Your Trading System

Frequently Asked Questions



Chapter 11 - Conclusion

Slow Acceptance

Blame Game

Understand the Game

Decreasing Leverage; Decrease Return

Fortune Favors the Bold



Appendices

A - Personality Traits of Successful Traders

B - Trend Following Models

C - Trading System Example from Trading Recipes

D - Modern Portfolio Theory and Managed Futures

E - Critical Questions for Trading Systems



Resources

Endnotes

Bibliography

About the Author

Index