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How to increase your luck surface area (2010)

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Re: How to increase your luck surface area (2010)

#101

Post by graeme »

dataflow wrote: post #95
stouset wrote: post #54

Earlier quoted context omitted.

Your observation about young people with four-figure net worths thinking it’s rational to gamble it all on options is pretty much this week’s equivalent of those living paycheck-to-paycheck “investing” in the lottery. The bigger problem is that this is rarely just a one-time decision to gamble. And repeatedly doing this is statistically pretty certain to lose you significant amounts of money—particularly when compare…

> Your observation about young people with four-figure net worths thinking it’s rational to gamble it all on options is pretty much this week’s equivalent of those living paycheck-to-paycheck “investing” in the lottery. It's not—the lottery is by design guaranteed to have negative expected returns. The stock market isn't.

Stock trading has negative expected returns compared to buy and hold though.

Re: How to increase your luck surface area (2010)

#102

Post by fnimick »

dehrmann wrote: post #69
motohagiography wrote: post #31

Taleb talked about this with his recommendation to get exposure to randomness that has asymmetric upside, and is analogous to luck is preparedness meeting opportunity. What I like about the OP's model is it also explains the asymmetry of social media where people do very little at all and talk about is a lot because the kind of non-linear success we are aiming for is a function of exposure. When you have wealth of an…

> the economy doesn't provide anything better to invest in for under $50k What's wrong with index funds? Real estate isn't everything.

I think the underlying assumption, which wasn't spelled out in the parent, is that any amount of money under $super-rich is similar amounts of worthless. If you genuinely believe that, then high-risk swings at a big payday make more logical sense than a low-risk gradual growth strategy.

I've heard friends express this - if you don't have $1 million +, you're just varying degrees of poor - so there's no point at gradual growth from 20k to 50k and etc when you're just as miserable. Might as well risk it all to try to get to the big time, since they don't see a reasonable path to growing gradually to anywhere worth living.

Re: How to increase your luck surface area (2010)

#103

Post by darkerside »

PartiallyTyped wrote: post #66
stouset wrote: post #54

Earlier quoted context omitted.

Your observation about young people with four-figure net worths thinking it’s rational to gamble it all on options is pretty much this week’s equivalent of those living paycheck-to-paycheck “investing” in the lottery. The bigger problem is that this is rarely just a one-time decision to gamble. And repeatedly doing this is statistically pretty certain to lose you significant amounts of money—particularly when compare…

Being a 4 digit net worth grad student in Europe, riding a few meme stocks just for a short-while has increased my 'wealth' and given me tremendous amount of financial freedom. I understand that the odds are against me, but really, the expectation even when accounting for variance, and adjusting for risk tolerance are a no brainer to me. I made >40% of my net worth in the first 2 weeks of January alone, and with GME…

The trouble is that, if it works, why wouldn't you try it again? You're not only a single data point, you are also a snapshot in time. Two months ago, you didn't have much. And, unless you truly decide to stop doing what you're doing, you are likely to have about the same two months from now.

Re: How to increase your luck surface area (2010)

#104

Post by credit_guy »

PartiallyTyped wrote: post #66
stouset wrote: post #54

Earlier quoted context omitted.

Your observation about young people with four-figure net worths thinking it’s rational to gamble it all on options is pretty much this week’s equivalent of those living paycheck-to-paycheck “investing” in the lottery. The bigger problem is that this is rarely just a one-time decision to gamble. And repeatedly doing this is statistically pretty certain to lose you significant amounts of money—particularly when compare…

Being a 4 digit net worth grad student in Europe, riding a few meme stocks just for a short-while has increased my 'wealth' and given me tremendous amount of financial freedom. I understand that the odds are against me, but really, the expectation even when accounting for variance, and adjusting for risk tolerance are a no brainer to me. I made >40% of my net worth in the first 2 weeks of January alone, and with GME…

My advice to you would be to have an exit plan. For example, set aside 20% of your assets in a savings account, maybe even some type of account where it's not that easy to cash out, to limit the temptation of dipping into it. Then, as your assets grow (if they do), at various thresholds, you set aside preset amounts of money. This way, if you "lose it all" one day, you don't get to "walk instead of taking the metro", you get to afford a down payment for a smaller apartment instead of a bigger one.

Re: How to increase your luck surface area (2010)

#105

Post by ghaff »

postit wrote: post #63

I struggle a lot with advertising my work outside the company. I'm the kind of engineer that will get anything done regardless of the tech (or people/process) complexity, and I always end up watching someone else in the team going to conferences to present my work. Random reasons random, but mostly because my inner klout is way bigger than my outer persona.

Do you not want to be the person presenting or are you being prevented from doing so for whatever reason. (And if the reason is something like presentation skills, do you care enough to do something about it?)

Re: How to increase your luck surface area (2010)

#106

Post by jlevers »

etrautmann wrote: post #29
pototo666 wrote: post #28

Earlier quoted context omitted.

I haven't seen one that explains the origin of passion or whether it is possible to become passionate. --- As Bezos said, you can't choose your passion, your passion chooses you.

I disagree - passion can emerge after you’re much deeper into something. I liked building things but wasn’t passionate about engineering until my last year in undergrad. It took 3-4 years of grinding away uncertainly until I had enough skill to make it really fun and interesting. That knowledge snowballs. Plenty of people are passionate about work which appears arcane. Few of them started with that.

Cal Newport has a book that discusses this this called So Good They Can't Ignore You, which I found really interesting. His thesis is basically that the people who are most satisfied with their work are those who stuck with something until they got really good at it, regardless of whether it was the topic they were "most passionate" about (passion can be fickle, IMO).

Re: How to increase your luck surface area (2010)

#107

Post by dehrmann »

threedots wrote: post #76
dehrmann wrote: post #71

Earlier quoted context omitted.

> The real Robin Hood-esque company in this whole thing is Vanguard This. I do worry a bit that there's something I'm missing because Vanguard is a Boomer thing that's no longer relevant, but I suspect all the research is solid and Vanguard being shareholder-owned aligns interests. Robinhood is probably just clever marketing and gamification of stock and options trading.

No you're good. I'm a career hedge-fund/market guy and all of my investable assets (outside of my company and my house) are in vanguard trackers. I'd guess most of my friends who are professional investors are the same (except they likely have some investment in their own fund). That's not to say there aren't better investment options in the world but they aren't accessible to ordinary people (even quite rich ones).

> I'd guess most of my friends who are professional investors are the same

I'm curious about this. Hedge fund guys make enough to be accredited investors, but they mostly don't invest in them? Are the minimums too high? Are the yields not that great? I know the 2010's weren't great years for hedge funds. I also halfway wonder if the real product hedge funds sell is complex strategies to pension fund manages who think it's hard to explain their job if they're just buying index funds.

Re: How to increase your luck surface area (2010)

#109

Post by the_local_host »

stouset wrote: post #54
motohagiography wrote: post #31

Taleb talked about this with his recommendation to get exposure to randomness that has asymmetric upside, and is analogous to luck is preparedness meeting opportunity. What I like about the OP's model is it also explains the asymmetry of social media where people do very little at all and talk about is a lot because the kind of non-linear success we are aiming for is a function of exposure. When you have wealth of an…

Your observation about young people with four-figure net worths thinking it’s rational to gamble it all on options is pretty much this week’s equivalent of those living paycheck-to-paycheck “investing” in the lottery. The bigger problem is that this is rarely just a one-time decision to gamble. And repeatedly doing this is statistically pretty certain to lose you significant amounts of money—particularly when compare…

> Your observation about young people with four-figure net worths thinking it’s rational to gamble it all on options is pretty much this week’s equivalent of those living paycheck-to-paycheck “investing” in the lottery.

But when you "invest" in the lottery, you don't get to help blow up a hedge fund. I think many of the retail participants in the GME phenomenon find some entertainment value in what they're doing.

That said, I do think Robinhood makes it too easy for people to put on positions that they simply don't understand. The fiasco with "1R0NYMAN" comes to mind.

Re: How to increase your luck surface area (2010)

#110

Post by ClumsyPilot »

gwnwest21 wrote: post #70
punnerud wrote: post #47

Earlier quoted context omitted.

I love how Reddit (and HN) enable fast sharing, fact checking of information and lifting ideas. When it comes to increase luck surface I think Clubhouse maybe will become one of the most important platforms. GME case seems to exploit the possibility for “short attack” by flipping the table into a infinite price increase, because the hedge funds accidentally created more fake shares that there is shares in existence a…

Hedge Funds managers have infinite resources and are working with Data Firms to prevent this from getting out of control again. These firms will use AI to scout social media platforms chatter and report back in real time what stocks are gaining momentum with retail investors. https://www.marketwatch.com/story/wall-street-looks-for-ways... https://www.ft.com/content/04477ee8-0af2-4f0f-a331-298744489...

They also have bots posting shit encouraging people to sell

Also, whats 'Infinite resources?'

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