Cutting Edge introduction: Followers of fashion

clearstream-models

Asset price bubbles are often driven by investors on winning streaks that then spectacularly fail in the following bust, known in financial folklore as picking up pennies in front of a steamroller. The track record of such traders looks great – until their gains are wiped out. But the flipside of this – tail risk strategies – can get a bad rap, as the big win that makes up for a long history of small losses may take time to arrive.

Trend-following strategies can sometimes appear this way – racki

To continue reading...