CTA Trend Following
The core CTA recipe: in each futures market, go long if the trend is up and short if it is down, size by volatility, and let the stop or the signal flip you out.
Definition
CTA Trend Following refers to the core CTA recipe: in each futures market, go long if the trend is up and short if it is down, size by volatility, and let the stop or the signal flip you out. Keep that definition fixed when comparing series, managers, or regimes — renaming the same tape does not create a new signal.
Why it matters
It is a named object desks use to frame risk, positioning, or process. When the core CTA recipe: in each futures market, go long if the trend is up and short if it is down, size by volatility, and let the stop or the signal flip you out shifts, related hedges, limits, and narratives usually need an explicit update rather than a quiet assumption.
Case
Suppose a desk is positioned for the opposite of what cta trend following is saying. If the core CTA recipe: in each futures market, go long if the trend is up and short if it is down, size by volatility, and let the stop or the signal flip you out moves against that book, the first question is not “is the story clever?” but whether size, hedges, and stop logic still match the observation.
How to read it
Keep the definition fixed, then challenge it with cross-checks before sizing. Prefer a short written null hypothesis for CTA Trend Following: what would falsify the current reading in the next window?
Ask the macro AI about this object
Opens Copilot with Codex + RAG context, or send the object into Alpha Factory intake.