If a player shoots few baskets in a row, people generally predict that the next shot will also be a basket.
This is ignoring the fact that each shot is independent of the ones that came prior.
Have you ever had 4-5 profitable trades in a row, and you bet all your profits on your next trade feeling "in the zone" only to lose it all?
That's called as "hot-hand fallacy" bias.
I ran a poll recently to outline two classic biases we have as humans.
Thread below 👇👇
Let's say you see a cricketer hit four 6's in a row.
— Shravan Venkataraman \U0001f525\U0001f680\U0001f4b0 (@theBuoyantMan) December 30, 2020
If you have to bet on the next ball's outcome, what would you bet on?
If a player shoots few baskets in a row, people generally predict that the next shot will also be a basket.
This is ignoring the fact that each shot is independent of the ones that came prior.
This is classic hot-hand fallacy.
Each ball's outcome is independent.
The probability is not 50% FYI (number of outcomes is not 2).
This is an emotional bias and is usually attached to human performance related events only.
These people displayed the classic "negative-recency" bias, which is also called the "Gambler's Fallacy".
This is more pronounced if the previous few outcomes are the same.
This is like predicting a tail in the next toss if the last few
coin tosses were heads.
This is why they display the traits of gambler's fallacy with objects and games that are typically not attached to human performance (ex: roulette).
People tend to believe that a streak is likely to continue when a person is on a hot successful streak.
From @kunalb11 to the Bansals, there are many beneficiaries of this fallacy.
Generally when a trader has had 4 or 5 successful trades in a row, they get a bit more brash, and over-bet on their 6th trade
even though the 6th trade is completely independent of the previous trade outcomes.
8/ There are other types of traders who when they have had 4-5 successful trades, think the next is most likely to be a losing trade, and avoid that trade.
Those who avoided that trade thinking it would end up being a loser, generally turn out to be the suckers.
Follow a well tested system for betting with whatever strategy you trade. Position sizing is of paramount importance, and dynamic betting is far more complex in trading, and more often than not fails.
It may sound appealing on paper, but determining whether a win or a loss is highly probable in the next trade is not an easy task.
Dynamically breaching the tested betting system because you "feel" or "instinctively know" the potential outcome of the next trade is bad.
The third time, you'll have the hot-hand fallacy playing within the fallacy. You'll be further emboldened to risk more, and it usually ends up disastrous.
But they are not.
In fact, since they take 100x fewer bets than regular traders do, they are the ones most exposed to the risks associated with these two fallacies.
Some day sooner or later, someone looking at bitcoin doing all this crazy bull run is going to ditch most of his portfolio and put the proceeds into bitcoin.
And bitcoin is going to bomb.
And this particular investor is going to lose everything.
More from Shravan Venkataraman 🔥🚀💰
** MEGA THREAD ON Cryptocurrencies/Blockchain**
I wanted to know the best resources to learn about cryptocurrencies and blockchain for someone with zero knowledge. I asked Twitter, and Twitter answered.
This thread is a compilation of the best resources I was recommended. 👇👇
Let's start with ** BOOKS **
The first thing you should do before you pick up any book:
Learn about Bitcoin & Ethereum by reading the respective whitepapers.
- [Bitcoin white paper](https://t.co/cErOaFn6QL) by Satoshi Nakamoto
- [Ethereum White paper] (https://t.co/0g5kYCGJGq) by Vitalik Buterin
Even if you are not tech savvy, you can get a good grasp about how blockchain functions from these papers.
1) *The Basics of Bitcoins and Blockchains: An Introduction to Cryptocurrencies and the Technology that Powers Them* by Antony Lewis
This book covers topics such as the history of Bitcoin, the Bitcoin blockchain, and Bitcoin buying, selling, and mining.
It also answers how payments are made and how transactions are kept secure.
Other cryptocurrencies and cryptocurrency pricing are examined, answering how one puts a value on cryptocurrencies and digital tokens.
I wanted to know the best resources to learn about cryptocurrencies and blockchain for someone with zero knowledge. I asked Twitter, and Twitter answered.
This thread is a compilation of the best resources I was recommended. 👇👇
Let's start with ** BOOKS **
The first thing you should do before you pick up any book:
Learn about Bitcoin & Ethereum by reading the respective whitepapers.
- [Bitcoin white paper](https://t.co/cErOaFn6QL) by Satoshi Nakamoto
- [Ethereum White paper] (https://t.co/0g5kYCGJGq) by Vitalik Buterin
Even if you are not tech savvy, you can get a good grasp about how blockchain functions from these papers.
1) *The Basics of Bitcoins and Blockchains: An Introduction to Cryptocurrencies and the Technology that Powers Them* by Antony Lewis
This book covers topics such as the history of Bitcoin, the Bitcoin blockchain, and Bitcoin buying, selling, and mining.
It also answers how payments are made and how transactions are kept secure.
Other cryptocurrencies and cryptocurrency pricing are examined, answering how one puts a value on cryptocurrencies and digital tokens.
In today's round up, I have some amazing threads, resources, and plenty of solid advice for business, finance, career from twitter.
Here's the roundup of 17 of the best and the most useful threads, tweets, and resources I found last week. 🧵
1/ How to find spreadsheets on any topic in the
2/ A thread by @wes_kao on making your customers hungry and excited to buy from
3/ Life brings you a lot of afflictions. But if you look around, there's a lot of beauty around you. Most often, drowning in the afflictions, we can't recognise or appreciate the beauty.
@wdmorrisjr wrote a damn good thread on finding beauty around us.
4/ This one is for all the job goers and job seekers.
@SahilBloom who recently hit 500k followers and has several accomplishments to his belt (career wise) wrote this thread on standing out in a hiring
Here's the roundup of 17 of the best and the most useful threads, tweets, and resources I found last week. 🧵
1/ How to find spreadsheets on any topic in the
How to find spreadsheets on any topic in the world:
— Blake Emal (@heyblake) February 13, 2022
1. Go to Google
2. Search site:docs(dot)Google(dot)com/spreadsheets \u201cYOUR TOPIC\u201d
3. Search, scroll, succeed pic.twitter.com/VJsYQKyi0J
2/ A thread by @wes_kao on making your customers hungry and excited to buy from
How to get customers excited, hungry to buy, and ready to say yes:
— Wes Kao \U0001f3db (@wes_kao) February 13, 2022
3/ Life brings you a lot of afflictions. But if you look around, there's a lot of beauty around you. Most often, drowning in the afflictions, we can't recognise or appreciate the beauty.
@wdmorrisjr wrote a damn good thread on finding beauty around us.
You\u2019re not looking for more success, stuff, or sex.
— David Morris (@wdmorrisjr) February 13, 2022
You\u2019re searching for beauty.
Here\u2019s how to find it: \U0001f9f5
4/ This one is for all the job goers and job seekers.
@SahilBloom who recently hit 500k followers and has several accomplishments to his belt (career wise) wrote this thread on standing out in a hiring
10 ways to stand out in a hiring process (that don\u2019t involve your resume):
— Sahil Bloom (@SahilBloom) February 13, 2022
Hedge Funds spend millions of dollars per year to access high quality financial datasets.
Retail sources cost anywhere from $5k-50k per year.
But, here are 11 data sources that have HIGH QUALITY and FREE data you can access right away.
🧵 👇
1/ Alpha Vantage | https://t.co/ExlS7Jdnsz
Provides real time & historical equities, forex, and cryptocurrencies data across 60+ exchanges.
They provide both intraday and D/W/M timeframe data.
You can also access economic & fundamental data for last 20 years through them.
2/ IEX | https://t.co/drqeoU8Ee1
Investors Exchange provides historical data going back upto 15 years for US equities through API access.
You'll need an API key in order to access the API.
3/ EconDB | https://t.co/6mZxDeaJfh
This website provides economic data and economic indicators for almost all the countries in the world.
You can search for your preferred dataset through their search engine here
4/ Quandl | https://t.co/fW4PEQaW66
Quandl has financial and alternate data across 50+ exchanges, from over 300 sources.
They also have information on capital markets, energy, shipping, healthcare, education, demography, economics and society.
Retail sources cost anywhere from $5k-50k per year.
But, here are 11 data sources that have HIGH QUALITY and FREE data you can access right away.
🧵 👇
1/ Alpha Vantage | https://t.co/ExlS7Jdnsz
Provides real time & historical equities, forex, and cryptocurrencies data across 60+ exchanges.
They provide both intraday and D/W/M timeframe data.
You can also access economic & fundamental data for last 20 years through them.
2/ IEX | https://t.co/drqeoU8Ee1
Investors Exchange provides historical data going back upto 15 years for US equities through API access.
You'll need an API key in order to access the API.
3/ EconDB | https://t.co/6mZxDeaJfh
This website provides economic data and economic indicators for almost all the countries in the world.
You can search for your preferred dataset through their search engine here
4/ Quandl | https://t.co/fW4PEQaW66
Quandl has financial and alternate data across 50+ exchanges, from over 300 sources.
They also have information on capital markets, energy, shipping, healthcare, education, demography, economics and society.
More from Trading
DJ @ITRADE191 multiple chart analysis for INTRADAY TRADING.
1. Core setup
2. Pivot points trades
3. PDH/PDL trades
4. Open interest addictions combined with rejections on charts.
5. Website to confirm bias
Very quick read.
Share if you liked for the benefit of everyone.
•Main setup of @ITRADE191
He used this setup daily for all trades.
1. EMA crossover 10/20
2. Supertrend 10/3
3. Vwap
4. RSI >
•Volume always greater than
•Candle Rejecting from
•Pivot settings
1. Core setup
2. Pivot points trades
3. PDH/PDL trades
4. Open interest addictions combined with rejections on charts.
5. Website to confirm bias
Very quick read.
Share if you liked for the benefit of everyone.
•Main setup of @ITRADE191
He used this setup daily for all trades.
1. EMA crossover 10/20
2. Supertrend 10/3
3. Vwap
4. RSI >
@MiteshFan @Mitesh_Engr @Abhishekkar_ MY TRADING SETUP .... I've been using it for a long time .. result good try it \U0001f607 pic.twitter.com/XThUD0ftbl
— itrade(DJ) (@ITRADE191) June 13, 2020
•Volume always greater than
Volume Should always be above 20 pic.twitter.com/CPgxLgpPKF
— itrade(DJ) (@ITRADE191) June 13, 2020
•Candle Rejecting from
— itrade(DJ) (@ITRADE191) August 25, 2020
•Pivot settings
— itrade(DJ) (@ITRADE191) October 20, 2020
You May Also Like
THREAD: 12 Things Everyone Should Know About IQ
1. IQ is one of the most heritable psychological traits – that is, individual differences in IQ are strongly associated with individual differences in genes (at least in fairly typical modern environments). https://t.co/3XxzW9bxLE
2. The heritability of IQ *increases* from childhood to adulthood. Meanwhile, the effect of the shared environment largely fades away. In other words, when it comes to IQ, nature becomes more important as we get older, nurture less. https://t.co/UqtS1lpw3n
3. IQ scores have been increasing for the last century or so, a phenomenon known as the Flynn effect. https://t.co/sCZvCst3hw (N ≈ 4 million)
(Note that the Flynn effect shows that IQ isn't 100% genetic; it doesn't show that it's 100% environmental.)
4. IQ predicts many important real world outcomes.
For example, though far from perfect, IQ is the single-best predictor of job performance we have – much better than Emotional Intelligence, the Big Five, Grit, etc. https://t.co/rKUgKDAAVx https://t.co/DWbVI8QSU3
5. Higher IQ is associated with a lower risk of death from most causes, including cardiovascular disease, respiratory disease, most forms of cancer, homicide, suicide, and accident. https://t.co/PJjGNyeQRA (N = 728,160)
1. IQ is one of the most heritable psychological traits – that is, individual differences in IQ are strongly associated with individual differences in genes (at least in fairly typical modern environments). https://t.co/3XxzW9bxLE
2. The heritability of IQ *increases* from childhood to adulthood. Meanwhile, the effect of the shared environment largely fades away. In other words, when it comes to IQ, nature becomes more important as we get older, nurture less. https://t.co/UqtS1lpw3n
3. IQ scores have been increasing for the last century or so, a phenomenon known as the Flynn effect. https://t.co/sCZvCst3hw (N ≈ 4 million)
(Note that the Flynn effect shows that IQ isn't 100% genetic; it doesn't show that it's 100% environmental.)
4. IQ predicts many important real world outcomes.
For example, though far from perfect, IQ is the single-best predictor of job performance we have – much better than Emotional Intelligence, the Big Five, Grit, etc. https://t.co/rKUgKDAAVx https://t.co/DWbVI8QSU3
5. Higher IQ is associated with a lower risk of death from most causes, including cardiovascular disease, respiratory disease, most forms of cancer, homicide, suicide, and accident. https://t.co/PJjGNyeQRA (N = 728,160)
