Episode 13: The Punk Rocker of Trend Following: Mike Melissinos, SanDisk's 40-Bagger & April 2026 Review

This month the three turtles are joined by Mike Melissinos, founder of Melissinos Trading and one of the genuinely uncompromising classic trend followers you can count on one hand. Same system, same rules since 2011, no drift, no compromise, and no watering it down for institutional palatability. Rich and Adam are also fresh back from a few weeks in Malaysia, refreshed and ready, and they have walked straight into one of the wildest months the markets have served up in recent memory.

In this episode:

📊 Battle of the Trend Following Indexes, April 2026

April was a month that did everything it could to shake a trend follower loose. Adam broke it down week by week and the picture was almost comical in its violence. Week one brought a tariff shock and a commodity explosion, with oil ripping higher. Week two delivered a ceasefire reversal that sent crude tumbling back down. Week three saw the trend cycle re-engage amid more volatility, and week four closed with the Strait shutting again, a rally in energy, and a fall across the metals complex. A genuine whipsaw from open to close, and yet the systematic universe held up far better than the headlines would suggest.

The numbers told the real story. The Classic Trend Index finished April up 6.7%, the highest return against the peer benchmarks we track, and a strong reversal of a slightly negative prior month. The outperformance was not just nominal. It held up on the long term risk adjusted measures too, whether you prefer MAR, Sharpe, Sortino, or any of the other metrics you care to throw at it. Coming into the end of the Australian fiscal year, those are numbers investors can be pleased with, distributions and the tax man notwithstanding.

But the single month is a slender statistic, and Rich was quick to steer the conversation toward something deeper. Looking at the VAMI chart, the separation between the Classic Trend Index and the rest of the mob since January 2020 is not narrowing. It is widening. Rich framed this as the shift from what he calls smooth world to rough world. For much of the decade after the global financial crisis, the wider field of managers made a rational commercial decision to smooth their return profiles, trim volatility, and manage drawdowns more tightly in order to look more palatable to institutional investors. The trouble is that you do not get that smoothness for free. You pay for it with your convexity, systematically trimming the very outlier trades that define classic trend following. In smooth world you might get away with it. In rough world, the world of pandemics, inflation shocks, energy crises, and geopolitical fracture, you pay a steep price. And to make matters worse, those smoothed and modest return profiles are now being competed away by cheaper replication products that approximate them at a fraction of the fee.

Rich made the case that this dynamic may be accelerating rather than fading. As more and more capital floods into passive equity, pricing becomes less efficient at the single stock and sector level, correlations shift, and the macro trends that systematic traders exploit become more pronounced and more persistent. We may be entering an extended regime rather than enjoying a lucky run, one where staying wide, staying convex, and staying patient generates real geometric wealth for those who hold the line. The classic guys did cop a meaningful drawdown earlier in the year, which Rich calls the price of admission, but they have accelerated back toward their high water marks at pace. As Dave Dredge would put it, this is the racing car with the good brakes, able to mitigate the worst of the volatility and then accelerate hard out of the corner.

👉 Full report: https://www.aussieturtles.com/battle-of-the-trend-following-indexes-april-2026/

📈 What’s Moved the Needle

Three sets of charts, three different angles on where the opportunity is hiding. Jerry opened with the Australian dollar, one of the strongest currencies on the board, and used it to make a broader point that classic trend followers do not have to pair everything against the almighty dollar. Pair the Aussie against the New Zealand dollar or the Canadian dollar and you get bigger trends, different chart patterns, and a smaller entry ATR on two highly correlated markets, which means a larger position when the correlation finally breaks. He reached back to the 1990s for the perfect illustration: a long German Mark against French Franc position where neither leg did much against the dollar, but the combination became a monster trend because the ATR was tiny and the correlation so tight that it only took a small break to produce an enormous move. The lesson is simple. Do not forget your currency crosses.

Mike brought the chart of the episode. SanDisk, up over 4,000% in a year, a genuine 40-bagger and the poster child of the AI storage trade. It came into his universe through a separate strategy he runs that watches the components of the S&P, applies a fixed selection rule, and simply takes equal weight positions in whatever is genuinely the strongest. SanDisk has sat at number one for months. Jerry, predictably, took issue, not with the performance but with the philosophy. His view is that a selection rule that filters markets in and out runs into sample size problems, and that classic trend following demands a fixed universe where you take every single trade. The math gods, as he put it, do not care whether you skipped the cocoa trade because of a clever filter or a failure of discipline. You did not take the trade, and that is all that counts. It made for a lively and good natured stoush, and it set up the deeper conversation about why so many CTAs are happy to trade the components of a commodity index or a currency index but freeze up at the idea of trading single stocks with the exact same breakout rules.

Adam tied it all back to the AI and RAM thematic sweeping the Asian indices. Taiwan was up around 100% over the trailing twelve months, Japan around 50%, and the Samsung-heavy Korean index up roughly 300%, running from two thousand to six thousand and still looking strong. The conversation turned thoughtful on the trade-offs of indices versus single stocks. An index cannot be taken over and is unlikely to gap fifty percent in a day, which mutes the outliers, but it also cannot suffer an accounting scandal or a regulatory bombshell out of nowhere. For now the team trades the futures for the liquidity and the low cost, trainer wheels firmly on, though nobody ruled out single stocks finding their way into the portfolio down the track.

🎙️ Spotlight: The Mike Melissinos Story

This was the heart of the episode, and it was everything Turtle Talk was built for. Not the polished, sanitised version of a trader’s story, but the real thing, with all the doubt and the hard decisions left in.

Mike’s path into trend following began in the most unlikely place, a quiet summer in 2007 spent auditing hedge funds in a Midtown Manhattan accounting office with nothing to do. Reading to fill the hours, he stumbled across Michael Covel’s books just as the subprime cracks were beginning to show. A friend got him an interview at Bear Stearns that autumn, and from inside those walls he watched the global financial crisis unfold while quietly tracking the trend followers who were thriving in the chaos. When Bear collapsed, the lesson burned itself in. The traders around him were dug into their beliefs even as the building came down, over leveraged, never cutting losses, doubling down. The trend followers he was watching were honest about their losses, respected the trend, and refused to put themselves in a position to be wiped out. That was the golden ticket, and at twenty three with nothing to lose, he took it.

He launched Melissinos Trading in 2011 with three limited partners, into one of the toughest regimes the strategy has ever faced. The years from 2014 to 2018 were, in his words, an odyssey. Dark times, a lot of rage, a moleskin notebook somewhere with the imprint of an iPhone he hurled at the wall in frustration. He survived a drawdown of more than fifty percent. What carried him through was not a tweak to the system but the people around it. A rock solid partner at home, now his wife of eleven years. Coffees with Jerry where the two of them licked their wounds and reminded each other it would be alright. And Ed Seykota and the Trading Tribe, where Mike had spent time before he ever launched, working through the self doubt of starting out. When Mike called him at the bottom, Ed told him, in that precise way of his, that it sounded like he had the trend following blues. That was all. This is just how it is.

The discipline that came out of all of it is the part worth holding onto. Mike described himself as often frustrated but never confused about what to do. The right thing is always to keep doing the system. And when the stellar performance finally arrived this year, his answer to how it felt was striking. He feels nothing. He is doing the system, dotting every i and crossing every t, and trusting the process to do what it is supposed to do. The feelings, he stressed, are never the problem. It is the response to the feelings that takes traders down. Tellingly, during that fifty percent drawdown, not one of his roughly fifty investors called. Except his dad, who is in the fantasy hockey league and is, by Mike’s own admission, just as much of a lunatic. From eleven markets at the start to around a hundred today, spread across South Africa, Australia, and the Far East, Mike has stayed true to who he is. And he had the best line of the day for what that makes him and the handful of others still doing this the original way. It is punk rock. Countercultural. They are not in midtown with the big shiny offices. They are in the village, the cool kids downtown, and you have to go and find them.

🔍 Coming Soon: Myth Busters and the Cutback Rule

We had so much fun that we ran clean out of clock at the two hour mark, which means a couple of the segments we had lined up will have to wait. The good news is that Mike is coming back to finish the job. Next time we tackle two Myth Busters, one led by Jerry and one by Mike, along with a Shell Mail listener question on the cutback rule that is set to spark a proper four-way debate. Make sure you are subscribed so you do not miss it.

📚 The Books

Want the theoretical foundation for why markets adapt? Complex Adaptive Markets: How Living Systems Shape Finance explores the full architecture of feedback, emergence, and adaptive behaviour in financial markets, and what it means for how we trade, invest, and understand risk. 👉 https://www.amazon.com/dp/B0FKZP8FQJ

Want the theoretical foundation for why trend following works? The Fractals of Finance: Determinism, Adaptation and the Geometry of Markets bridges complexity science with practical trading implementation, with a foreword by Jerry Parker, original Turtle Trader. 👉 https://www.amazon.com/dp/B0GHTH1WNK

Want a practical field manual for trading trends and capturing outliers? The Aussie Turtles Trend Following Guide: A Field Manual for Hunting Outliers adapts the timeless principles of the original Turtle traders into a systematic, rules-based approach for modern markets, co-authored with Adam Havryliv. 👉 https://www.amazon.com/dp/B0FT1NCXP4

All three are available now on Amazon in paperback, hardcover, and Kindle. If you have read any of them, a short review goes a long way in helping more traders discover them.

🌐 Episode Resources

Connect with Mike Melissinos at mi*****@***************ng.com, https://melissinostrading.com, and https://www.linkedin.com/in/michaelmelissinos/

📩 Send your Shell Mail questions for future episodes: https://www.aussieturtles.com/contact

Closing Thought

April threw everything it had at the systematic universe and the classic guys came out the other side in front. But one month is a slender statistic, and it is the long arc that matters here. The divergence on that VAMI chart since 2020 is not noise, it is the quiet reward for keeping your convexity intact while the rest of the field smoothed theirs away. Mike’s story is the same lesson told in the first person. Stay true to the system through the dark years, keep your nerve through the fifty percent drawdown, and be there with your positions on when the big trends finally arrive. It is punk rock, it is countercultural, and right now it is working.

Stay systematic. Stay patient. And may the trend be with you.