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TikTokers Are Trading Stocks by Copying What Members of Congress Do

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Re: TikTokers Are Trading Stocks by Copying What Members of Congress Do

#91

Post by aborochoff »

DevKoala wrote: post #86
bko wrote: post #80

Earlier quoted context omitted.

This is also unlikely to work because Congress members don't do particularly well on trading. It's very hard to trade successfully, even with insider information its not entirely obvious what a stock price will do. It seems obvious because news media often reports ad-hoc analysis on a stock price movement. For instance, they'll say "Apple up 5% based on surprising App store revenue growth", but if it were to drop you…

Ehh, Nancy Pelosi beats most hedge fund managers consistently year over year. https://unusualwhales.com/i_am_the_senate/pelosi

This looks to me to be just for 2020. Is there more analysis somewhere showing it’s consistent?

Re: TikTokers Are Trading Stocks by Copying What Members of Congress Do

#92

Post by CharlieMunger »

mritchie712 wrote: post #88
CharlieMunger wrote: post #60

Earlier quoted context omitted.

There's a community on Reddit that studies Berkshire's purchases (investments made by Buffett/Weschler/Combs) and tries to follow, purchasing only below what Berkshire paid: https://old.reddit.com/r/brkb/ For example, in 2020 and early 2021 Berkshire paid $59 for Verizon, buying $9 billion worth (a huge Buffett/Weschler telecom investment). Verizon now trades at about $54, so this community is buying.

Wouldn’t this bias towards the “losers”?

Short-term stock price changes are noise.

Berkshire's investments are based on a deep understanding of the business and are intended to produce good long-term results. Factors like economic moat, trends in consumption, conservative valuation, etc.

For example, Berkshire purchased Apple (AAPL) between 2016 and 2018, at an average price of $35 per share (P/E ratio of 12 or 13), and it was years before that paid off. The Redditors buy during those years, before the payoff.

Re: TikTokers Are Trading Stocks by Copying What Members of Congress Do

#93

Post by cronix »

DevKoala wrote: post #86
bko wrote: post #80

Earlier quoted context omitted.

This is also unlikely to work because Congress members don't do particularly well on trading. It's very hard to trade successfully, even with insider information its not entirely obvious what a stock price will do. It seems obvious because news media often reports ad-hoc analysis on a stock price movement. For instance, they'll say "Apple up 5% based on surprising App store revenue growth", but if it were to drop you…

Ehh, Nancy Pelosi beats most hedge fund managers consistently year over year. https://unusualwhales.com/i_am_the_senate/pelosi

* Nancy Pelosi's husband, Paul

Not saying she didn't give him info, but she didn't do the actual trades. He's an investment manager.

> Paul Pelosi, investment manager and the husband of House Speaker Nancy Pelosi, purchased up to $11 million worth of mega-cap tech stocks in May and June, according to a financial disclosure form filed last week.

https://markets.businessinsider.com/news/stocks/nancy-pelosi...

Re: TikTokers Are Trading Stocks by Copying What Members of Congress Do

#94

Post by kregasaurusrex »

Front-running is nothing new, this is simply a game of follow-the-leader where copying a group's investment strategy is done until larger players learn to frontrun or adversarially trade against the aforementioned frontrunners entering in. For example, a scanner may pick up an SEC filing published at 4:01 PM saying that the CEO, CFO, and CIO all purchased shares in their company, and traders would buy shares aftermarket before most institutions/derivative traders would see the report tomorrow morning. I'd guess that today's active investing crowd is a lot more interested in seeing outsize short-term returns based on information asymmetry than members of congress who more likely to hold in order to get long term capital gains tax applied.

Re: TikTokers Are Trading Stocks by Copying What Members of Congress Do

#95

Post by sumedh »

jjeaff wrote: post #33
JasonFruit wrote: post #5

Earlier quoted context omitted.

And by doing that, we're further enriching members of Congress. We should be taking a mass oath to sell any stock they buy. Then, of course, they'd only invest in potential opponents' corporations. It could turn into a real arms race.

We need to just pass a law already that forbids them from purchasing or owning individual stocks. After all, assuming they aren't trading on insider information, it would be to their own benefit anyway.

Then their cousins and very close friends will do the trading on their behalf.

Re: TikTokers Are Trading Stocks by Copying What Members of Congress Do

#96

Post by lostcolony »

DevKoala wrote: post #86
bko wrote: post #80

Earlier quoted context omitted.

This is also unlikely to work because Congress members don't do particularly well on trading. It's very hard to trade successfully, even with insider information its not entirely obvious what a stock price will do. It seems obvious because news media often reports ad-hoc analysis on a stock price movement. For instance, they'll say "Apple up 5% based on surprising App store revenue growth", but if it were to drop you…

Ehh, Nancy Pelosi beats most hedge fund managers consistently year over year. https://unusualwhales.com/i_am_the_senate/pelosi

Yeah, but take the random trades of 435 people and a normal distribution is still going to have a top (and bottom!) outlier. It's certainly reasonable to assume an investment manager (her husband, who is making most of the trades) might be part of the reason to be such an outlier.

And even discounting that and looking for shenanigans, well..."she timed buying NFLX almost perfectly" with a purchase a month before it was announced they were going into the video game space; why the heck would she have known that? That isn't related to legislation, that isn't something they would have gone to the government for; that would be a purely business decision by Netflix. How the heck would she know about it?

Re: TikTokers Are Trading Stocks by Copying What Members of Congress Do

#97

Post by nradov »

not2b wrote: post #21

This is unlikely to work because of the timing delay. Suppose a member of Congress has access to inside information and trades on it. They have 45 days to disclose the trade. By the time the trade is disclosed, the market has already moved: if Pelosi or McConnell or whoever bought low so they could sell high, a month later the increase is probably already baked in.

When stocks only go up, every trading strategy appears to work. Let's see what happens during the next sustained bear market.

Re: TikTokers Are Trading Stocks by Copying What Members of Congress Do

#98

Post by EduardoBautista »

wolverine876 wrote: post #37
subsubzero wrote: post #20

Members of congress should not own or trade stock, full stop. I am so surprised that this is even legal, it gives an extremely unfair advantage to congress as they have inside info on military contracts, lawsuits and if govt. agencies initiate investigations into companies. You want to end corruption in politics(well make it less corrupt) then barring congress from owning and trading stocks and other related securiti…

FTA, you will be happy to know (and I agree): > Congressman Raja Krishnamoorthi, a Democrat from Illinois, is part of a bipartisan group of House and Senate members who have introduced legislation banning lawmakers from owning individual stocks.

I don't understand how this would work. Owning stock is not some kind of investment only the elite have access to.

What about people who worked at a company that gave them a few thousand dollars in equity compensation? Would they forced to sell their stock?

Does this apply to an S&P 500 ETF, if so, why?

Re: TikTokers Are Trading Stocks by Copying What Members of Congress Do

#99

Post by McAtNite »

wolverine876 wrote: post #55
daveslash wrote: post #27

I love that this links to text.npr.org . Another text-only news site is lite.cnn.com.

It's an underappreciated genre: News Aggregators http://68k.news - The best I've found. I don't know why it's not better known, but I found it by luck and don't know who is doing it. https://f6oclock.com - seems to load stories in Outline.com. Serious real news, but I don't know how they are chosen or who is doing it. --- Publications https://nytimes.com/timeswire - chronological feed https://guardian.gyford.com - Ph…

Both of those websites detail who runs them:

68k.news - simplified html of google news from a guy who uses retro computers - https://youtube.com/ActionRetro

F6oclock - is a frontend for stories “rising” on /r/politics - https://github.com/j3parker/f6oclock

Sorry for the crappy formatting. I’m on mobile.

Re: TikTokers Are Trading Stocks by Copying What Members of Congress Do

#100

Post by [deleted] »

kregasaurusrex wrote: post #94

Front-running is nothing new, this is simply a game of follow-the-leader where copying a group's investment strategy is done until larger players learn to frontrun or adversarially trade against the aforementioned frontrunners entering in. For example, a scanner may pick up an SEC filing published at 4:01 PM saying that the CEO, CFO, and CIO all purchased shares in their company, and traders would buy shares aftermar…

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