A great example of a short book that can provide excellent content, for a reasonable price (that reflects the shortness of the book). This is the second book I’ve read on momentum-trading,otherwise known as trend following. The other one, “Trend Following” by Mike Coval, was at least several hundred pages long, that translated to over 14 hours of content in the audiobook, much of which were filler-material from the author’s podcast. This book will not take more than 2 hours to digest, and provides much better value in terms of understanding the mechanics of trend following.
Coval spends many hours talking about trend following, without every really defining it well to to the reader, which can be very frustrating to someone who is new to the topic. Kratter comes out within the first few minutes and succinctly spells it out: Searching for (and investing in) stocks where the 50-day moving average has exceeded the 200-day moving average, and where the equity price is above that signal level on the trading day. That simple, he even provides the reader with 2-broad conceptual buckets to organize candidate equities to invest in, “Formula” companies and growth/tech companies.
Next the Kratter explains some very basic rules to entering/exiting, including when you should take profit. None of this is science, and if you wanted to try your hand algorithmic ally implementing some of this, you’re free to try, albeit at your own considerable risk. The book does a good job however, explaining the kind of “common sense” ideas one may use when looking at securities move in the intraday, as well as how to maintain discipline (congruence with a system/strategy), to ensure consistent results.
Overall, this is really what a new retail investor who wants to try their hand at trend-following needs to read. This provides a clear first-step, and enough concept to go deeper into with other books if/when needed. If you want to spend another 14 hours listening to fluff about the history of trend following and the “philosophy” of trend following, go ahead and get Coval after you’ve read this one. Otherwise, start here, and as the author suggest, try it first with a paper account. Recommended.