The Patience of a Trend Follower: NVIDIA Earnings/Portfolio Review

“If you can’t take a small loss, sooner or later you will take the mother of all losses.” Ed Seykota

Classic trend following thrives on simplicity: ride winners, cut losers, and trust the trend. Success hinges on disciplined execution, not market prediction.

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How To Manage Your Portfolio:

1️⃣ Diversify Broadly:
Trade across asset classes (stocks, bonds, crypto, commodities, currencies). Trends often emerge in uncorrelated markets, spreading risk.

2️⃣ Set Clear Rules:
Define entry/exit criteria. Use moving averages, breakouts, or price momentum to stay systematic.

Example: Enter when price crosses 50 day moving average; exit when it falls below 200 day.

3️⃣ Size Positions Wisely:
Risk small per trade (e.g., 1 to 2% of capital). Avoid overexposure to any single trend. Volatility based sizing adjusts positions for specific assets so losses stay the same.

Example: A loss for Natural Gas is the same as a loss in the S&P 500.

Example: Bitcoin (the most volatile asset in history) would have a much smaller position than US treasury bonds. (Bonds are one of the least volatile assets.)

4️⃣ Cut Losses Quickly:
Stick to predefined stop loss levels. Minimize losses by exiting trades when they violate your rules no second guessing.

5️⃣ Let Winners Run:
Hold onto trending positions until the reversal signal hits. The biggest gains often come late in the trend.

6️⃣ Review and Adapt:
Monitor portfolio performance regularly. Adjust strategies to evolving markets, but avoid over tweaking your systems, consistency is key.

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Why It Works:
Trend following captures big, asymmetric moves while minimizing downside. It’s about probabilities, not perfection.

Pro Tip:
Emotion is your enemy. Automate where possible to maintain discipline.

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📈 Takeaway:
Follow your rules, embrace simplicity, and trust the strategy. The trend is your friend, if you let it.

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Portfolio Review:

I hate talking about current events…

NVDA earnings are today….