Trend-following is one of the oldest trading techniques, and trend-following systems belong to the standard repertoire of investors and traders. Many times it has been successfully used in futures markets. But does it work on stocks?

Research shows it does, and it performs well for such a simple strategy. There are many trend-following systems with different rules, but all systems have a common attribute.

They try to buy growing assets, although “grow/trend” could be defined in many ways.