Customer Reviews

The ETF Trend Following Playbook: Profiting from Trends in Bull or Bear Markets with Exchange Traded Funds

5 star:		(14)
4 star:		(2)
3 star:		(5)
2 star:		(3)
1 star:		(3)

 

 

This book is packed full of descriptions of various ETF's, however there is almost no suggestion on putting various portfolios together or how to use the selected portfolio other than based on your investing likes or dislikes. It makes a strong point to get out of the mindset of buy and hold and gives an brief intro to 200 d moving averages, but using the 200d average is not clearly gone into with much detail or examples.

The most useful suggestion is placing a stop or picking an exact point to get out of a position. You rarely see this in typical books promoting individual stocks and certainly never with mutual funds. This is frequently overlooked in stock investing and makes tremendous sense when following Lyon's strategy of trend investing with ETF's.

I think almost all the info from this book can be obtained by reading Lyon's interesting insights on his website and as listed in the above reviews. I was expecting more strategies in using ETF's. The author is an obvious knowledgeable proponent of ETF's, but this book fails as a playbook. I can imagine future versions of this book with chapters dealing with specific situations such as economic depression, inflation, weakened dollar, retirement portfolio, etc.

Thus book is really not much more than a brief introduction to the field of ETFs. As for the "trend following" in the title, readers interested in the technique will be sorely disappointed. The only recommendation is to buy when an ETF trades above the 200-day exponential moving average and sell when it falls below it. That's it. Seriously. Add to that the frequent plugs of the author's website and you really have to wonder why anyone would bother to put out a book like this and seriously claim to be providing any sort of useful service to the investing public.

The secret to "trend following" success is no longer a secret. Tom Lydon has spilled the beans. Not that trend following is such a closely guarded secret. As a matter of record, the majority of people who are aware of trend following strategies have either ignored them or rejected them. But now the time is ripe for consideration by the ignorant and reconsideration by the learned.

The ETF Trend Following Playbook (2010) by Tom Lydon will be a boon to investors, especially those who got burned by the 2007-2009 bear market. If, like me, you were hurt by adherence to a buy-and-hold strategy, you might be ready, as I was, for the switch from fundamental investing for the long haul to technical trading for the intermediate or short term.

Tom Lydon's Playbook answers practically any question I can propose, such as: (1) what is "trend following," (2) who can benefit from trend following, (3) how can I put trend following strategies into practice, (4) where can I do my trading, (5) what equities should I be trading, (6) how can I clearly identify the beginnings of bullish and bearish trends, (7) how can I protect my portfolio from trend reversals, (8) when should I buy, (9) when should I sell, (10) why make the switch to trend following strategies now?

Exchange Traded Funds (ETFs) are the object of Lydon's affections. He likes them because of their diversity, their easy trading, their openness, their low fees, their index tracking, their relatively low risk, and their tax friendly performance.

This book has what a trader needs for navigating the marketplace. There is a detailed table of contents, a helpful glossary of technical terms, a comprehensive list of references and resources, numerous charts, tables, and illustrations, punctuated by a topical index of subjects, people, and funds.

What's missing? Sadly, explanations of stop-loss strategies are missing. Stop-loss orders will protect your assets by generating an automatic sell when your ETF gets hit by a sudden downturn in the market. Stop-loss is defined in the glossary, but how can a trader take advantage of it? On his website, Lydon suggests a stop-loss setting of 8%. I sleep better at night when I have limited my loss of capital to the level of risk I am willing to bear.

My Favorite Chapter: I especially like Chapter 3 on Spotting Trends. This is the chapter where Lydon teaches the tools of the trade. There are only three rules to follow: (1) buy when the price moves above the 200-day moving average, (2) sell when the price moves below the 200-day moving average, and (3) leave fear and greed out of it.

Lydon operates a website, [...] that serves as a dynamic extension of this Playbook.

This book provides a good introduction to the world of ETF trading along with a strategy of utilizing a 200-day moving average strategy. It also provided a listing of some of the ETFs available in various sectors although since there are new ETFs appearing almost daily, the author cannot be faulted for not listing more of them than he did.

The author's 200-day moving average strategy is certainly easy to understand for the reader but in his efforts to make it appear so simple, he seems to have left out some details that someone might need to know when attempting to implement it. For example, he recommends buying your chosen ETF when it crosses above the 200-day moving average and selling it when it falls below the 200-day moving average line. Simple enough. Unfortunately, he fails to indicate what to do if you're interested in buying an ETF that is already above the 200-day line. When would he recommend still buying it? He mentions that whipsaws can occur but he makes no recommendation as to whether a trader should wait to see whether an ETF that dips below the 200-day moving average line remains there or whether to simply sell and not look back.

Although he does make mention of the use of stop loss orders, he makes no recommendations within the book about whether traders should put in a stop loss after an ETF drops by a certain percentage or not. I did visit his website and found that he recommends setting a stop loss at 8% below a recent high. In my opinion, this is the sort of advice that should have been included within the book, but I guess one of the purposes of writing the book was to increase visits to his website.

For what its worth, I did visit the website and found it to be a valuable source of additional information regarding ETFs. I anticipate visiting it on a regular basis.

The book failed to deliver on ETF trend-following. Other than the constant repetition of the value of using the 200-day EMA, the book offered few other ideas on following ETF trends or sector rotation. The book did a good job of reviewing the relatively new and expanding world of ETF investing, but did not serve as a playbook at all for a serious ETF investor trying to find other than subjective ideas for moving in and out of ETF trades. In spite of all the hype, it left this ETF investor with that common empty feeling so familiar with many investing how-to publications. Once again, publishing houses do a great job with motivating the buyer, but the authors rarely intend to reveal any truly useful day to day investing playbook ideas.

Good book as an introduction to ETFs and the concepts of trend-following. However, as a "Play Book", it is really very limited indeed. The author's rules of trend following cover LESS THAN ONE PAGE. The rest of the book covers what ETFs are and the different types available. All of this information is available for free elsewhere, including the author's own website, and the Seeking Alpha website. I thought of giving the book one star but it is a good introductory book for those who want to know what an ETF is.

BOOK HAS A FEW GOOD IDEAS BUT THERE IS ALOT OF FILLER...IT IS LIKE THE MATERIAL COULD HAVE BEEN COVERED IN 10 PAGES...

All of the reviews prior to this filing are on target. Plus, the daily offerings on Tom's excellent website are basically continuing enhancements to each of his two books. If you bought the first book, save your money on this one. It is basically an elegant rehash. Curiously, portfolio construction is not addressed at all here. I suspect that in the future, suggested portfolios will be offered on a monthly fee basis as an option on the free website.

I picked up this book at a local bookstore's going out of business sale. I hadn't read any reviews, but was intregued and had been looking for something to take my ETF investing to the next level. I got about 100 pages into it and realized that there was very little useful information. The other reviews are correct, the ONLY "play" this playbook is as follows: buy when the ETF crosses above its 200 day moving average and sell when it moves below. Now I never played football, but it's my understanding that playbooks usually contain more than one play! The author fails to explain WHY this strategy works (not sure that it actually does), and only provides a number of charts with a 2 year time horizon. The charts are virtually useless as an investor implementing this strategy would be looking at more detailed charts. In addition, he never touches on the fact that an equity can cross it's 200 day moving average numerous times before it finally breaks out to a defined direction. Are we supposed to just keep trading in and out every time hopeing that eventually it works and blowing thousands on commissions and incorrect trades? Also it is possible for the 200 day moving average to be brought gradually down, even below your entry point, before it is crossed. He never even touches on this. The book repeates itself routinely, almost as though it wasn't thoroughly edited/proofread. The author routinely references seemingly random "experts". For example, this is a direct quote from page 16: "Bill Fritz, and investor who lives in the greater St. Louis, Missouri, area, has been using the 200-day moving average strategy since the mid-1980's: "When it's above the 200-day moving agerage, I'm 100% in. When it's below, I'm 100% out."......" The book is rittled with these references. It reminds me of a middle school student trying to fill space in a five page report!

The last 40 pages are glossary, references, and index, and chapter twelve is all about bond fund ETF's and is 16 pages that he clearly didn't write. He states right at the begining of the chapter that Chip Norton contributed substantially to this chapter, but also it's pretty obvious by the difference in writing style.

This book is essentially nothing more than a list of ETF's, explained only by their boilerplate prospectus speak that you can get from yahoo finance or any other investing research website. It tells you that you can choose to buy an ETF that tracks the broad market for example the S&P 500 (SPY) or you can get more specific by choosing a fund of only large caps, or transports, or just airlines, etc.....DUH! What it doesn't tell you is how to MAKE that decision (other than the afore mentioned 200 day moving average drivel).

Keep the $25 in your brokerage account, it'll do you a heck of a lot more good there!

To call this book elementary would be an insult to kindergartners everywhere - this pamphlet disguised as a book has one idea and flogs it through 200 pages of obvious and basic information, available with a ten second search on the internet. The one idea is that investors should get into the market, or a security, when it rises above its 200-day moving average, and get out when it falls below. That's it! The rest is a listing of ETF's that anyone with an internet connection can find instantly, with a dash of self-promotion of Lydon's ETFrends site. To anyone who has studied the market for more than five minutes, this book is a waste of time and money. Apart from the 200-day MA idea, there's nothing useful about trends, entries, exits, risk, money management or any other investing topic.