31–40 of 118 posts
It sounds like despite your ideas of what failure is, by age 25 you've learned and applied more than most people ever will.
http://en.wikipedia.org/wiki/FatKat_(investment_software)
http://www.idsia.ch/~juergen/finance.html
http://www.technologyreview.com/blog/guest/25308/
I'm sure there are other examples. I think part of the problem is this guy thinks he can get rich quickly with just the right set of programming instructions.
A lot of people are leaving comments critical of his goal of beating the market as playing a zero-sum game, just pushing wealth around, having no value for society, etc. This strikes me as dubious and high-handed, to say the least. First, as to the value of the endeavor. He is trying to, in his words, "come up with an algorithm that finds pockets of profitability in a cloud of probable randomness." If he could really…
There are certainly plenty of talented people working in finance. That talent is just completely wasted.
After eight years, I have nothing concrete to show for my efforts. So sad, so true. This is what happens when you play a zero-sum game. Even if you win, someone has to lose. Here's an idea. For the next 8 years, why don't you do something that helps others by making the pie bigger for everyone instead of just trying to game a bigger piece of a smaller pie for yourself. When you do for others, you always have somethin…
I don't see the causality. He has yet to succeed because it's an incredibly difficult problem domain. There are problem domains of similar difficulty that benefit people that he could have chosen and still be in this position.
A lot of people are leaving comments critical of his goal of beating the market as playing a zero-sum game, just pushing wealth around, having no value for society, etc. This strikes me as dubious and high-handed, to say the least. First, as to the value of the endeavor. He is trying to, in his words, "come up with an algorithm that finds pockets of profitability in a cloud of probable randomness." If he could really…
Financial speculation has a long history of being disparaged by various anti-capitalist demagogues. Speculation is a zero-sum activity between speculators but, from an economy-wide perspective, speculators nevertheless perform a valuable function in the dissemination of new information and the formation of prices. This latter function is why it is so hard -- the identification of an arbitrage opportunity and acting in the markets to make profits means that price differentials fade away and thus the potential for profits. A speculator has to continually find new opportunities in order to make money over the long term.
If you're running after the Holy Grail, you have no choice but to be a hero. What kind of pressure is that ? In fact, most of the answers are in front of you, in the way you express yourself.
For instance, the myths of the Holy Grail and Tantalus are ones of insoluble challenge and dilemma. Therefore, when you are wondering if the Holy Grail exist, where it is, and if you'll ever reach it... You are probably asking the wrong questions.
Instead, you should ask yourself : "Who am I ?". Do you want to be rich, or do you want to "beat the markets" ? That's 2 different things, one is a mere consequence of the other. Where is your priority ? As it's not clear from your writing, I suppose it's not clear in your mind either.
After eight years, I have nothing concrete to show for my efforts. So sad, so true. This is what happens when you play a zero-sum game. Even if you win, someone has to lose. Here's an idea. For the next 8 years, why don't you do something that helps others by making the pie bigger for everyone instead of just trying to game a bigger piece of a smaller pie for yourself. When you do for others, you always have somethin…
This is what happens when you play a zero-sum game. Even if you win, someone has to lose. I don't see the causality. He has yet to succeed because it's an incredibly difficult problem domain. There are problem domains of similar difficulty that benefit people that he could have chosen and still be in this position.
Then again he/she is creating software and algorithms.
My mother was down on the floor of the NYSE the other month, and she got the opportunity to corner a trader who she noticed was relying heavily on algorithms. She asked "What's the difference between a good trader and a good algorithm?" The trader said "nothing.If you're buying 1000 shares, it's probably better to simply put in a market order. A large hedge fund seeking to buy many hundreds of thousands - where the d…
However, I respectfully disagree that humans are better at making trading decisions than computers. The world of algo trading can be divided into two sides, a) high frequency traders, who through fast cancel-and-replace limit orders and colo with the market centers, try to act as virtual market-makers (or scalpers, depending on your perspective), b) buy-side institutional fund managers who want to complete their orders, without HFT predators and negative market pressure. Large block orders are spliced into small lots (i.e., VWAP) and sent to the market using intentional limit price over time to hide the movement of a huge buy or sell order on the market.
Human beings might be better than machines at picking single stocks for long term investing (although most people are probably still better off investing in an ETF). But that's not how sell-side traders make money in the first place. Guys like GS/MS/Timberhill make money by having the unfair advantage of faster execution speed, more capital and specialized trading algo's against the small retail investors.
After eight years, I have nothing concrete to show for my efforts. So sad, so true. This is what happens when you play a zero-sum game. Even if you win, someone has to lose. Here's an idea. For the next 8 years, why don't you do something that helps others by making the pie bigger for everyone instead of just trying to game a bigger piece of a smaller pie for yourself. When you do for others, you always have somethin…
How is it always a zero-sum game to win? Fundamentally, trading stocks is not that at all. If I buy one of the first issued shares of "Tasty Ice Cream" for $1 because I want the company to spread their goodness as well as get a return on my money, no one has lost. If I lose my job the next week and need to sell my share which may be valued at $1.10 the person that buys has not lost, especially if he receives a dividend long enough to cover the $1.10.