SI371: Trends Don’t Form Randomly. They Form Reflexively ft. Richard Brennan
SI371: Trends Don’t Form Randomly. They Form Reflexively ft. Richard Brennan  
Podcast: Top Traders Unplugged
Published On: Sat Oct 25 2025
Description: Richard Brennan returns this week to explore how markets truly move - not through randomness or rationality, but through impact, feedback, and memory. What begins with a single trade builds into structure, not pattern; alignment, not noise. Drawing from neuroscience and fractal geometry, Rich challenges the idea that markets can be understood without understanding interaction. The episode builds toward a pointed exchange on position sizing - closed equity versus dynamic exposure - not as a technical footnote, but as a reflection of first principles. In a system where the path shapes the outcome, how you define risk... often reveals how you think the world works.-----50 YEARS OF TREND FOLLOWING BOOK AND BEHIND-THE-SCENES VIDEO FOR ACCREDITED INVESTORS - CLICK HERE-----Follow Niels on Twitter, LinkedIn, YouTube or via the TTU website.IT’s TRUE ? – most CIO’s read 50+ books each year – get your FREE copy of the Ultimate Guide to the Best Investment Books ever written here.And you can get a free copy of my latest book “Ten Reasons to Add Trend Following to Your Portfolio” here.Learn more about the Trend Barometer here.Send your questions to info@toptradersunplugged.comAnd please share this episode with a like-minded friend and leave an honest Rating & Review on iTunes or Spotify so more people can discover the podcast.Follow Rich on Twitter.Episode TimeStamps:00:00:00 – Welcome to the Systematic Investor Series00:00:23 – Niels’ intro, show setup, and warm welcome to Rich00:00:57 – Heatwave down under: context and small talk00:02:10 – Rich: divided brain, AI vs embodiment, and markets needing rules00:07:50 – AI’s edge shrinks prediction windows; why that helps trend following00:10:35 – Gold’s violent selloff; electricity vs oil as the new macro lens00:14:51 – “Trend heaven”: why the backdrop now looks robust00:18:12 – Post-GFC compression vs today’s decoupling and trends00:22:43 – Impact and reflexivity: trades reshape the next trade00:28:23 – Non-ergodic markets: path dependence beats Gaussian assumptions00:35:48 – Volatility ≠ risk: compression warehouses latent tail risk00:40:08 – Engineer robustness, don’t optimize to statistics00:49:41 – From micro impulses to structure: feedback builds trends00:50:06 – Patterns vs structure; outliers as phase transitions00:55:00 – Ensemble design: behavioral (not correlational) diversification01:03:05 – Survival first: closed-equity sizing in a non-ergodic world01:05:43 – Niels’ counterpoints: dynamic sizing, flows, and “cutback” debate01:12:20 – Rich: why he frames it as outlier hunting01:16:30 – Wrap-up, programming notes, and disclaimerCopyright © 2025 – CMC AG – All Rights Reserved----PLUS: Whenever you're ready... here are 3 ways I can help you in your investment Journey:1. eBooks that cover key topics that you need to know about In my eBooks, I put together some key discoveries and things I have learnt during the more than 3 decades I have worked in the Trend Following industry, which I hope you will find useful. Click Here2. Daily Trend Barometer and Market Score One of the things I’m really proud of, is the fact that I have managed to published the Trend Barometer and Market Score each day for more than a decade...as these tools are really good at describing the environment for trend following managers as well as giving insights into the general positioning of a trend following strategy! Click Here3. Other Resources that can help youAnd if you are hungry for more useful resources from the trend following world...check out some precious resources that I have found over the years to be really valuable. Click HerePrivacy PolicyDisclaimer