The best traders don’t share their edge.
I remember reading the Market Wizards books and this would come up often in the interviews. Some felt strongly about it, some didn't think much of it. It depends on the person.
Show HN: Duedilly.io – Accuracy of Reddit Trading Ideas
61–70 of 89 posts
Re: Show HN: Duedilly.io – Accuracy of Reddit Trading Ideas
#62Neat idea! A couple of nits: Looking at the recommended page duedilly.io/asset/ZOM "Posts that are not bold have been removed/deleted on Reddit" -> "Posts that are bold have been removed/deleted on Reddit" DD is not defined (one would have to go to the main page) and it is not a well known acronym.
> DD is not defined (one would have to go to the main page) and it is not a well known acronym. Worst, in the industry its often an acronym for "drawdown". I was quite confused until I saw the definition DD=due diligence on the homepage.
I've been in the industry for several years and had the same reaction when I first starting seeing wallstreetbets posts. For a while I even thought it stood for "double down" when it seemed like these were encouraging posts. Good point from you and the parent commenter -- I'll make that clearer.
Re: Show HN: Duedilly.io – Accuracy of Reddit Trading Ideas
#63Cool website. Percentage is a good place to start, but if you want to get closer to the alpha of a given idea, dividing the percentage return by its beta to the benchmark, then subtracting the return of the benchmark over the same period will get you closer.
I did consider beta adjusting performance and may do this in the future -- it does require more infra set up (ex. computing historical betas for these posts back in time).
Since my target demographic in this case was people on Reddit following trading advice I wanted to keep things straightforward first and slowly over time introduce those educational components to get it closer to how the industry thinks about it.
Re: Show HN: Duedilly.io – Accuracy of Reddit Trading Ideas
#64I took a gander-- the leaderboard lists 10 people making better than a 17% weekly return (3500% annualized). After extensive work cross-referencing the list with this one [1] my team was unable to find 10 candidates. Another explanation of outsized returns was deemed remotely possible but downvoted into oblivion [2]. I think it's really enticing to think you can make it rich by reading something on Reddit and doing a…
Hey there is quite a bit to think of before buying a fridge!
Measurements
Read reviews
Noise
Colour
Price
The list goes on and on!
Re: Show HN: Duedilly.io – Accuracy of Reddit Trading Ideas
#65Earlier quoted context omitted.
This is the dialect of /r/wallstreetbets. Apes strong together and all that jazz. To call someone a retard is a term of endearment, or a (not so) secret handshake. (fellow gambling degenerate)
That’s lovely. Bad news is a bunch of edgelords don’t get to dictate how language is used or what it means.
Lol what is an edgelord?
Re: Show HN: Duedilly.io – Accuracy of Reddit Trading Ideas
#66This is a big ask, but can you make one that analyzes seeking alpha posts? Seekingglpha.com ... Generally quite high quality posts, but I always lack the track record knowledge... To have this due diligence tool on the authors would be gold!
Re: Show HN: Duedilly.io – Accuracy of Reddit Trading Ideas
#67Looks like you don't handle stock splits. There was a 10:1 stock split for TTD a few months ago, so DDs before then are mostly just showing -90%. https://duedilly.io/asset/TTD/#/
Whoops, that's definitely a mistake. Need to backfill the split adjusted prices from the data vendor, good catch! Thanks a lot.
Re: Show HN: Duedilly.io – Accuracy of Reddit Trading Ideas
#68The best traders don’t share their edge.
Certainly believe that but wasn’t Michael posting on a blog pre 2008 telling people stuff?
Re: Show HN: Duedilly.io – Accuracy of Reddit Trading Ideas
#69Earlier quoted context omitted.
I'd say that's how most people outperform, they get a lucky break with a stock that goes x10 or something.
I don't know who you include in "most people", but from what I understand of the professionals, that's not at all how making money works. If what you describe happens, it means the portfolio risk dial is set way too high. The mistaken idea behind that is that people think risk and reward covaries. It does for single wagers, but when assessing profitability of investments, we must look at long term growth. When we do…
The Reddit people whose posts are being used here, but I can't be sure it's just a guess. I'm not talking about fund managers that follow strict rebalancing and risk guidelines. The creator of this webapp acknowledges this and says that it's very hard to be at the top of the rankings without this happening.
You're talking about the efficient frontier from Modern Portfolio Theory, no?
Re: Show HN: Duedilly.io – Accuracy of Reddit Trading Ideas
#70Earlier quoted context omitted.
I don't know who you include in "most people", but from what I understand of the professionals, that's not at all how making money works. If what you describe happens, it means the portfolio risk dial is set way too high. The mistaken idea behind that is that people think risk and reward covaries. It does for single wagers, but when assessing profitability of investments, we must look at long term growth. When we do…
The Reddit people whose posts are being used here, but I can't be sure it's just a guess. I'm not talking about fund managers that follow strict rebalancing and risk guidelines. The creator of this webapp acknowledges this and says that it's very hard to be at the top of the rankings without this happening. You're talking about the efficient frontier from Modern Portfolio Theory, no?
I'm referring to the analogous concept from E log X optimisation. (The "Kelly criterion".)
The efficient frontier based on Markowitz' mean--variance optimisation does not help you find a risk level that maximises growth, because it looks at one investment in isolation, not sequential reinvestment over a long period.
The analogous concept I'm referring to is the set of portfolios that are linear combinations of risk-free assets and the E log X optimal portfolio. These are all Kelly optimal under more and more restrictive constraints on allowed variation, but come with slower growth as a trade-off.
To reiterate, the E log X "efficient frontier" talks about how fast your portfolio will grow over time as you reinvest your gains. The Markowitz efficient frontier tells you something about the statistical nature of a single investment opportunit.