Most investors lose because they are running a predictive model in a system that punishes prediction. Richard Brennan has spent decades building the alternative: align with price instead of predicting it.
Richard Brennan is a trend follower, complex adaptive systems researcher, and author of The Fractals of Finance and Complex Adaptive Markets. He joins Mark McGrath and Brian "Ponch" Rivera on No Way Out for a conversation about why the market cannot be predicted, why it can be aligned with, and what that has to do with John Boyd, Karl Friston, and the free energy principle.
Rich came to trend following through a science background that would not let the standard economic assumptions go unchallenged. The conversation covers the market as a reflexive complex adaptive system, why calm markets build hidden fragility, phase transitions and nonlinear change, fat tails and power laws, why volatility is not risk, and the geometry of wealth. Ponch and Mark connect Rich's aligning with price to Boyd's orientation and Friston's free energy principle, and the convergence becomes the conversation.
Jerry Parker, who wrote the forewords to Rich's books, introduced him to the show.
Find Rich at atstradingsolutions.com, the Traders Outpost.
WATCH THE FULL EPISODE HERE ON NO WAY OUT TV:
