Ep. 891: Inside the Mind of Charles Faulkner with Michael Covel on Trend Following Radio
Michael Covel's Trend Following
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The Socialization of Risk
In the banking area, what happened there was that the banks were all trading the same algorithms. They could have diversified, but everybody kind of gets in there because it feels more comfortable to be with the group and then it doesn't feel risky. This is a perfect sense of why people that were tremendously risk averse in 2006 decided they had to get me compiled at the last minute. In fact, it seemed like it was a bigger risk that you'd lose out by not doing it than by doing it.
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