GC's Trend Following Logic: Why We Reconvene Signals with Acceleration and Volume

In GC's investment judgment, a 'trend following' stock is not simply followed just because the price is rising. One of the common mistakes investors make is to judge solely based on numerical increases. To avoid this tendency, GC simultaneously checks the acceleration of the MACD histogram and trading volume. This process is an essential step to make decisions based on reliable data, going beyond simple trends.

Why Are Acceleration and Volume Important?

When evaluating the likelihood of a trend continuing, it is very important that the price increase is supported by trading volume. For example, if the price is rising while trading volume is decreasing, it suggests that the likelihood of the price increase continuing is low. GC uses these indicators to assess the quality of the trend and to understand the actual market flow rather than just price movements. This serves as a basis for decisions that can give investors confidence.

Let’s take a closer look at GC's approach through some recent examples. For instance, an acceleration of the MACD histogram was observed in a specific stock, along with an increase in trading volume. This situation indicates that a strong trend may be forming, and GC interprets this as a buy signal. Such data-driven analysis is a key element that makes up GC's differentiated investment strategy.

GC's Principle of Transparency in Judgment

GC adheres to the principle of 'not hiding the basis of judgment.' This is to help investors understand the background and logic of each investment decision. For example, when a 'trend following' buy signal occurs for a stock, GC does not just inform that the signal has occurred, but clearly explains why that conclusion was reached. By doing this, investors can participate as active decision-makers rather than mere recipients of information.

Message to Investors

GC's approach is not just focused on returns. Rather, it aims to use 'Investment Decision Quality (IDQ)' as a benchmark to help investors strengthen their own judgments. This process encourages making rational decisions based on data rather than emotionally impulsive ones.

Investment decisions are most importantly based on one's own judgment. Join the GC Investor Challenge and experience this process firsthand. On October 1st, you can start in just 5 minutes!