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Trend Pilot TRND Delisted… Victim of 6 Year Bull Market

trend

TRND was a trend following ETF based on the S&P 500. Simple rule: close below your simple 200-day moving average for 5 days in a row and you sell SPY and go on T-Bills, viceversa you go full long SPY.

That’s it.
Simple indeed.

Above we compare the main index TPLCUT (the benchmark TRND is/was based on) vs SPY (buy and hold) from 1994. I have normalized the data to 100.

One can see the classic trend following pattern: capital protection during bear markets, some lagging performance during strong bull markets (by definition there is a bit of a lag to jump on board of a trend).

Trend following, as I have discussed vehemently during my presentations with the STA and MTA, has to be judged over a full economic cycle (or a bull-bear market cycle, if you wish).

We can see here the validation of the process: for 1% p.a. you wipe out the S&P 500 B&H by just holding this active ETF.

Not any longer, apparently. RBS seems to have delisted this ETF almost when one would need it the most.

A victim of a six-year bull market?

I am speechless for this is/was a fantastic idea to make trend following easily accessible to even the laziest of investors.

There are/were other TRDN like ETFs for Gold, Nasdaq 100 and, if memory serves me well, China and Oil.

Luckily PACER seems to have taken over from RBS

http://www.pacerfinancial.com/financial-advisors/pacer-etfs/

with a small tweak – but all is clearly explained here

http://www.paceretfs.com/products/ptlc

and the yearly management fees have dropped from 100 bps of RBS to 60 bps now.

Riccardo Ronco, CFTe

Head of Technical Analysis

Follow #RiccardoRonco @aviatelive

1st Floor

22 Ganton Street

London W1F 7FD

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