Aspect Capital examines how systematic trend-following strategies have navigated four major macroeconomic periods—from the DotCom bubble to the post-pandemic inflation surge—highlighting their adaptability and resilience amid shifting market conditions. They emphasize that while returns can be volatile in the short term, trend-following strategies have consistently demonstrated the ability to adjust to evolving regimes and deliver long-term diversification benefits.
Living with Trend Following: Lessons From the Past 25 Years
Aspect Capital
Research
14 Pages
Key Takeaways
Context matters: Trend strategies may initially struggle during market disruptions but tend to recover as clear trends emerge.
Adaptability over time: Trend-following has navigated four major market cycles, demonstrating long-term resilience.
Resilience through discipline: Investors who maintained consistent exposure to trend-following benefited from long-term diversification.
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