The Dangers of Trend Following

I do believe in these cycles, market cycles that Howard Marks also write about. And so for me, what we've seen in the last couple of years may really only be the beginning of this new interest rate cycle heading higher for a number of decades. But I think there is something in our industry to be said about firms that has very long track records and have had these experiences because it's one thing if you find something that works over 21 years but could actually be picking up on an environment when yields are falling. We know from research that long side trades in trend following tends to do better.

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