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Launch HN: Enombic (YC S20) – Create your own stock indexes

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Re: Launch HN: Enombic (YC S20) – Create your own stock indexes

#151

Post by jldugger »

So, most FAANG employees are not allowed to trade in derivates that short sell their own stock, which I figure is half insider trading protection and half ensuring equity compensation actually works.

However, I've often wondered if those employees could still offload some of the assumed risk of portfolio concentration by investing their free investable cash in, say, their own SP499: every company in the SP500 except the one they work for. Though I suppose you'd have to have a pretty big net worth to fully offset unvested shares this way.

Re: Launch HN: Enombic (YC S20) – Create your own stock indexes

#152

Post by leoncvlt »

This looks great, congrats! For those already using Trading212 in EU / UK, I've built a few tools that try and accomplish a similar thing using their pie features:

• etf4u (https://github.com/leoncvlt/etf4u) scrapes equities mutual funds and mix and match your custom indexes

• trading212-pie-sync (https://github.com/leoncvlt/trading212-pie-sync) takes the information from the tool above (or ay external source, really) and automatically updates the pie's allocation (which would take a long time if done manually)

Re: Launch HN: Enombic (YC S20) – Create your own stock indexes

#153

Post by flotothemoon »

This looks awesome, great idea. I'm drawn to any project that makes more or less inaccessible things programmatically queryable (and even controllable), so this fits the bill perfectly. And in finance, too! :D

Are you planning on eventually expanding to Europe? Or do you know of any similar services in the EU?

Re: Launch HN: Enombic (YC S20) – Create your own stock indexes

#154

Post by xiphias2 »

wheybags wrote: post #110
gwd wrote: post #104

Earlier quoted context omitted.

> (2) want to make minor changes to existing ETFs This is exactly the use case I've wanted for a long time -- I'd much rather just park most of my money in an S&P 500 index fund. But there are some companies there whose business practices I just find scummy; and if I own stocks in that fund, those companies will be doing those scummy things in my name and for my benefit. I realize there are "ethical" index funds, but…

1000% agree. "Ethical" is not restricted to "no guns, alcohol or cigarettes".

fast food and coke (Warren Buffet stocks) kill much more people than all of those combined.

Re: Launch HN: Enombic (YC S20) – Create your own stock indexes

#155

Post by mcgin »

_eb13 wrote: post #119
mcgin wrote: post #87

Nice idea, having worked in a similar problem space for a number of years, I have some questions. - How are you managing rebalancing, what might trigger a rebalance and how do you manage the tax implications of that? - With a rebalance/deposit/withdrawal are you always a taker in the market? - What's the custody side of this look like? i.e where do the stocks sit, are they in my brokerage account or are you custodian…

Thanks, would be curious to get your thoughts given your experience in this problem space. Since we lean DIY / prosumer, our thought is to provide options to the user. Around rebalancing, we're exploring a few options: calendar rebalancing, constant-proportion rebalancing, and rebalancing with only new contributions. Then, analytics to make it clear what is a short vs long-term holding. Right now we're non custodial,…

Always happy to chat with people about this space, contact info is in my profile if you want to reach out

Re: Launch HN: Enombic (YC S20) – Create your own stock indexes

#156

Post by deepGem »

Signed up for the waitlist. Just a quick question when you say construct sector specific indexes - are these indexes available for others to invest ? So for instance let's say i create an index and show my skin in the game by investing in that index with returns - can others potentially follow suit and invest in that index or even a portfolio ? This is something that I have been ruminating on for a while.

Re: Launch HN: Enombic (YC S20) – Create your own stock indexes

#157

Post by timwaagh »

I'd be worried about the costs. if i buy an 'index' of stocks weighed a certain way, then i guess you guys would be buying those stocks. except the number of stocks in an index is much larger than a typical portfolio. indexes fix this with economies of scale however you do not have the scale as everyone is creating their own indexes. wouldn't the client ultimately have to pay a lot of total transaction costs (even if its no-commission, there is still bid-ask spread) to the point of making the entire exercise inadvisable?

Re: Launch HN: Enombic (YC S20) – Create your own stock indexes

#159

Post by abanayev »

timwaagh wrote: post #157

I'd be worried about the costs. if i buy an 'index' of stocks weighed a certain way, then i guess you guys would be buying those stocks. except the number of stocks in an index is much larger than a typical portfolio. indexes fix this with economies of scale however you do not have the scale as everyone is creating their own indexes. wouldn't the client ultimately have to pay a lot of total transaction costs (even if…

This was my thought immediately upon reading the title. Would love to see what the team says.

Re: Launch HN: Enombic (YC S20) – Create your own stock indexes

#160

Post by govg »

timwaagh wrote: post #157

I'd be worried about the costs. if i buy an 'index' of stocks weighed a certain way, then i guess you guys would be buying those stocks. except the number of stocks in an index is much larger than a typical portfolio. indexes fix this with economies of scale however you do not have the scale as everyone is creating their own indexes. wouldn't the client ultimately have to pay a lot of total transaction costs (even if…

"The ubiquity of zero-commission and fractional-share trading means that diversification and customization is easier than ever"

I think what they are relying on is the fact that nowadays you can own fractional shares (so you don't have to spend that much money to own an index since you no longer care about owning whole number units) as well as zero cost trading (so you don't really have costs to maintaining a portfolio or creating one).

Note that in most cases the bid-ask spreads are low (since for major indices there is enough liquidity in their constituents), and as such won't meaningfully contribute to your gains / losses unless you are rebalancing often enough to factor this in(in which case, making an index is pointless).

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