050 – Tribute to Nelson Freeburg

Nelson Freeburg was the editor of Formula Research, a newsletter that developed systematic timing models for the stock, bond, and commodity markets.

He was also a research consultant working with institutional money managers to design proprietary timing models.

Nelson had been an active trader since 1980 and occasionally spoke about his work to audiences around the world.

In this episode, Linda Raschke shares the work of Nelson, his approach to model development and what we can learn by studying his work.

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Topics discussed

  • Timing models and the components Nelson used in his models
  • Russell growth vs Russell value model
  • Out of sample testing and sample size
  • Why Nelson focused so much on reducing drawdown
  • Nelsons biggest strengths in modelling and what we can learn from his approach
  • Using voting systems for trading
  • The benefits of overlaying models

Resources mentioned in this episode

  • The formula research paper Linda mentions in our chat can be downloaded from here
  • Nelson also did an interview with Larry Connors on developing the perfect trading system, here is part 1 and part 2

Watch this presentation by Nelson for the MTA

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