Retailers should try painting images of cars in their parking lots.
They could splurge for some covered multi-level parking. That would be nice.
Hedge funds use satellite images to beat Wall Street
201–210 of 233 posts
Re: Hedge funds use satellite images to beat Wall Street
#202Earlier quoted context omitted.
I'm more than a little surprised that Haas would publish an article that seems to indicate a complete lack of understanding of the purpose of the markets. Better data yields more efficient markets which is what we actually want. “Technology was supposed to level the playing field, but what I see is the fence separating sophisticated and unsophisticated investors growing higher,” says Patatoukas As if that's a bad thi…
Technology does level the playing field. As a software engineer, I can get access to realtime institutional-grade data and write strategies that were impossible even a few years before. Not even speaking about crypto exchanges, where all data is public.
> As a software engineer, I can get access to realtime institutional-grade data
One can get API access just like that? If so then I'm interested, might be fun to dabble with--can you name some of these providers?
Re: Hedge funds use satellite images to beat Wall Street
#203Earlier quoted context omitted.
> Do you really think this makes sense from a public policy perspective, to pit the retirement needs of the old against, e.g., the environmental health of the young? But couldn’t you argue in exactly the same way for disenfranchisement? Do you think retired people should be allowed to vote?
I think that argument actually supports their point. I believe that everyone has a human right to vote. However, retired people have generally already established themselves; therefore, the changes that government makes, particularly on social issues, has minimal effect on them. Therefore, I think its unfair for the generation who is still establishing themselves not to be held hostage to the previous generation's vi…
> Therefore, I think [it's] unfair for the generation who is still establishing themselves not to be held hostage to the previous generation's vision of society.
I think you have one more negation than you intended in that sentence.
Re: Hedge funds use satellite images to beat Wall Street
#204Earlier quoted context omitted.
Right. Even Jim Simons of Renaissance Technologies, has publicly stated that their edge is small. They amplify it with leverage, like all funds do.
Though I have a great amount of respect for them, I'll point out that Jim Simons may have multiple motivations to downplay the size of any edge that RenTech has over the averages.
And yet he leaks the returns of their private fund every year...
Re: Hedge funds use satellite images to beat Wall Street
#205Earlier quoted context omitted.
Indeed. The stock market isn't a game where one person's win is another's loss. The price is an information conduit which signals where the economy should allocate capital.
Both of these things can be true. Every transaction certainly provides us with information, but also, if two people trade based on competing beliefs about the price, one of them is wrong. As for it being a game, well, when dollars are used to purchase stocks, they almost never go into the coffers of the company whose stock it is. They go into the pockets of someone else who is also trading stocks. As you said, it's a…
The stock market is the frontend of the whole system. Companies can issue stock to raise money to fund operations, compensate employees, etc. Companies can also use their stock as collateral to borrow money. The higher the stock price the lower the effective cost raising money.
By being correct about a stock in a trade you end up being rewarded for decreasing the cost of capital of companies that do the most with it.
Re: Hedge funds use satellite images to beat Wall Street
#206Can someone with access to very recent satellite photography tell me how much corn they got planted in the Midwest this year (compared to last)? Thank you.
Re: Hedge funds use satellite images to beat Wall Street
#207Earlier quoted context omitted.
> As an occasional retail trader, it doesn't bother me at all that other market participants are trying to be better informed. In fact, it means that market prices are more likely to be properly-priced. What about companies that find out about your retail trade before it's even executed , and are able to act on that information to profit from your very intent to trade?
This is called front running and is super illegal.
Literally Robinhood’s business model
Re: Hedge funds use satellite images to beat Wall Street
#208Earlier quoted context omitted.
Though I have a great amount of respect for them, I'll point out that Jim Simons may have multiple motivations to downplay the size of any edge that RenTech has over the averages.
And yet he leaks the returns of their private fund every year...
The returns of the fund alone don't tell you the level of edge (alpha) of RenTech.
Alpha (the skill/edge component) is the excess return on a risk-adjusted basis.
Roughly, alpha is total-return - risk-free-rate - porfolio-beta * (market-return - risk-free-rate).
You can have a total return of 20%, a risk free rate of 3%, a Beta of 2, and a market return of 13% and you've actually underperformed the market on a risk-adjusted basis. Your alpha would be 20% - 3% - 2 * (13% - 3%) = -3%
Re: Hedge funds use satellite images to beat Wall Street
#209Earlier quoted context omitted.
Both of these things can be true. Every transaction certainly provides us with information, but also, if two people trade based on competing beliefs about the price, one of them is wrong. As for it being a game, well, when dollars are used to purchase stocks, they almost never go into the coffers of the company whose stock it is. They go into the pockets of someone else who is also trading stocks. As you said, it's a…
The stock market is the frontend of the whole system. Companies can issue stock to raise money to fund operations, compensate employees, etc. Companies can also use their stock as collateral to borrow money. The higher the stock price the lower the effective cost raising money. By being correct about a stock in a trade you end up being rewarded for decreasing the cost of capital of companies that do the most with it.
I understand how all that works, but the reality is that the number of transactions that actually involve a company giving someone shares in exchange for cash is vanishingly small compared to the total number of stock trades that happen. Some quick Googling indicates that in the first quarter of 2019, startups raised about $30b. Also according to some quick Googling, in 2013, the NYSE did about $170b per DAY of trading. Obviously that $30b number isn't close to all the capital raised by companies in that time period, but neither is the NYSE the only place where stocks are trading hands. The vast, vast majority of transactions do not involve a company raising money.
And just a minor quibble, a more accurate stock price doesn't always lower the cost to a particular company of raising money. It makes the market more efficient over all, for sure, but often companies would prefer a less accurate (ie, higher) stock price for the purposes of raising money.
Needless to say, I'm not convinced that this kind of volume is necessary to get most of the benefit of the stock market as a price discovery mechanism. I'm not saying anything needs to change, I'm just not sure it's such a huge public good.
Re: Hedge funds use satellite images to beat Wall Street
#210Earlier quoted context omitted.
Yes, but it's not like the cars are ONLY visible from space. You are welcome to organize a large group of people to travel around to parking lots and count cars and then privately share your findings. What the funds are doing is just a more efficient version of that. It's all public information.
If the information is only shared privately, then it seems to me that it is by definition not public information; regardless of what the law says.
What is your definition of "public information"? It's trickier than you may think to define it precisely. For example, is any processed version of "public information" also public information?