here’s a slightly wonky thread that people who use post-nominal letters will not like: let’s talk about real-time learning in quant-driven strategies and how to do it in practice, because a lot us do this as a result of real-world constraints. its basically TA with a dress-code.

so lets say you found a nee factor, but data is limited becuse it is new-ish? how the hell do you implement it without waiting eons in market-time? first: in small size because distributions are unknown. second: you update the calibration parameters dynamically as you go.

sometimes i am asked why i favor matching assets with volatility estimators instead of betas:
1) volatilities are not stationary but they undergo relatively synchronized regime changes
2) exponentially weighted vols are more responsive to changes in current conditions

3) betas are not stable in shorter terms and identifying changes takes longer and in the short term you get measurement errors if your sample is driving your benchmark
4) honestly the numerical methods are just simpler and i’m a dumdum so it makes it easier for me

5) for long-only baskets of different assets it avoids painful assumptions which may be wrong about correlation, which is good when you know your sample is low quality
6) for long-short baskets of like assets it avoids painful assumptions about intercepts (and therefore betas)

My 2021 DeFi Predictions:

1\ the rise of Decentralized Derivatives
In 2020, the embryo of the DeFi derivative market started to take shape. A dozen DeFi derivative platforms were established and began to launch mainnets. I expect this market will explode in 2021.

2\ Central bank currencies
The COVID-19 pandemic will continue to haunt the world's economy for some time. The economic uncertainty will last.
China will launch its Central Bank Digital Currency in 2021, and many will follow.

3\ Cross Chain BTC will continue to grow.
BTC will take a more important role in DeFi and Derivatives.

4\ Regulations intensify
There will be an increase in official and legislative scrutiny from regulatory agencies concerning the overall cryptocurrency industry internationally.

5\ More traditional money into Crypto and DeFi
Regulations are not bad things. More traditional money will find legitimate paths to crypto investment and in DeFi applications. This may become the drive to another great bubble.

1/15
By now you have undoubtedly seen the craziness going on in the stock market, with a selection of stocks surging hundreds if not thousands of percent in a matter of days or even hours, along with a whole bunch of financial jargon. So what exactly is going on? #velshi

2/15
One major term you have heard is "shorting" - which is just placing a bet that a stock will go down in price. #velshi

3/15
An investor can make money on this type of gamble by borrowing shares from a broker, w/o initially paying for them, selling them immediately & then later buying the shares at a lower price & returning them to the broker, keeping the difference in price as profit. #velshi

4/15
For example, an investor borrows 1 share of stock XYZ at $200 & sells it. The investor now has $200 at an initial cost of $0. However, the investor stills owes the broker that 1 share. #velshi

5/15
The gamble is that the price of the stock XYZ will go down - let's say to $100 a share. The investor can then buy the 1 share that it owes the broker at that lower $100 price. #velshi

Knowledge sharing initiative Book 3: "Zurich Axioms" by Max Gunther

The book crystallizes how to think about taking investment bets (position sizing), and how to reduce risks in investing & speculation. It focuses on teaching a balance between rewards & risks.

(1/n)

Here are the key takeaways from the book:

1. Take sizeable bets in life: Taking small bets will give you a good night's sleep as you have very little to lose, but the important point is "it won't ever make you rich".

(2/n)

2. Taking size-able risk is necessary to get rich but make sure you don't go bankrupt taking that risk.

3. Don't diversify too much as gains & losses will nullify each other.

(3/n)

4. Be less greedy to make money - Book some profits when you see a sudden huge increase in wealth - fear of regret will stop you from booking profits but don't be greedy as consistent streaks of lucks are rare in life.

(4/n)

5. Cut losses when you go wrong don't start praying that your losses will recover rather act quickly take some loss and sell out.

(5/n)

Technical Analysis and 3 Strategies to deploy for Aggressive, Moderate, and Conservative Traders.

🧵 Weekly Bank Nifty Analysis for 8th December Expiry:

To form a view, let's have a look at:

1. Multi-timeframe Technical Analysis
2. Option Chain Data

Also, 3 strategies to deploy for:

1. Aggressive Traders (2.6%)
2. Moderate Risk Traders (1.3%)
3. Low-Risk Traders (0.8%)

1. Technicals

Let's start by doing some basic technical analysis.

We'll look at:

• Weekly charts.
• Daily charts.
• Hourly / 60 min charts.
• 15 min charts.

1. Weekly-

• The market has given 4 continuous green closes, so not expecting a big momentum on upside.

• This week my view is that it can take a pause.

• Longer term trend is super bullish.

• Any dip will towards 41800 will be a retest, and should be used to go long.

2. Daily:

• Candlestick pattern—Hanging Man

• Chart Pattern—Breakout Failure

• A pin bar candle is very powerful but only after a downmove.

• Here it forms near the top of upmove.

• Means some sellers are present. Below 43000 can sell calls above 43600 for the week.

One of an interesting thing in Current stock market,is as soon as Saturn progressing after Retrogression phase, gained the speed in trine to Rahu - Both raw Metals & oil prices are doing good. At the sametime Rahu trine alignment with Jupiter has also boomed the bank market.

Trine movement of Rahu along with Saturn and Jupiter has broken all the bullish trend setter records and amplified the internal economy. In March 2020, Pluto, Ketu and Mars has totally shaken the market into bearish trend.Keep Remember Rahu is trend setter - Strong Bearish,

Ketu - is Trend breaker- Strong bearish.

Untill and unless Jupiter is keep moving aggressively without any affliction with Atichari Motion market will keep booming.

Period of Affliction will start from 21 December 2020 onward & when Sun will Join Jupiter in January 2021

Jupiter will be in its most aggressive motion, This is the period when Market will start fluctuating real bad in January month upto Feburary 2021 period.

From 4th of January 2021 onward upto 28th January, 10th Feburary 2021, as soon as venus moves toward dhanu & Capricorn, when complete Sarpa dosha will begin, Jupiter will be in super speed with Sun, there will be heavy conjunction of 6 planet's form in Capricorn-

An option buyer made Rs. 58 lacs from Rs. 2 lac capital in a span of just one month (March 2020 COVID crash).

He is none other than Mr. Subasish Pani.

THREAD: 11 things you must know to become an option buyer.

Collaborated with @AdityaTodmal

•Don't get carried away with the kind of return that Mr. Pani made in such a short period of time.

•This requires a high level of skill, and discipline in terms of which strike to choose, which time to trade, and which days to trade.

•It also comes with higher drawdown.

1/ Screen Time:

• Indian markets function from 9:15-15:30.

• Dividing this time zone into 3 sub parts:
- 9:15 to 10:30: trending market
- 10:30 to 13:30: for retracement
- 13:30 to 3:30: trending

2/ Focus on momentum:

• Option buyers make money when the momentum is quick.

• However if the market remain sideways for few days then the option starts to lose its value.

• This is because theta decay works against option buyers.

3/ Option buyers need momentum to make money:

• Hence focus on the 1st & 2nd time zone where the markets are trending.

• Avoid taking trades between 10:30am till 13:30.

• Special focus on Wednesday & Thursday as premiums are low and if you can catch momentum then good R/R.

By far, one of the most interesting Ethereum addresses I've seen is @0x_b1.

It's quite an interesting social experiment as well - a $300m whale starting a Twitter account for fun. Check their bio.

Let's break down the address and see what they are doing with their capital. 👇

0xb1 was created in mid-August, amid the food farming craze.

The address is active every day of the week and consistently makes transactions between 12:00 UTC and 6:00 UTC (sleeps between 7-11).

Likely U.S. based individual or team based on this history.

h/t @nansen_ai

0xb1 is a yield farming beast, to say the least.

It's industrial farming at its best - hundreds of transactions, swapping in and out of the latest yield farms on Ethereum.

Fun fact: the address has spent $111,000 in ether on transaction fees since its inception. Ow.

According to @DeBankDeFi, the address has a current net worth of $280 million, with $381 million in assets or staked assets and $101 million in debt.

Not too sure if this is 100% accurate, as there may be some new farms that it may not capture or represent properly.

99% of this capital is active in yield farms.

Out of the ~$280 million, only ~$250k is naked.

The address has $150 million worth of ETH and WBTC collateral deposited in Compound, which is being used to borrow $80 million worth of stablecoins.

C-ratio scares me a bit.

The importance of $XHV and its ecosystem of coming xAssets, in a world against privacy. $xUSD $BTC

A Thread.

1/

Crypto started out, with a brilliant idea. The idea was to create a trustless system of money, that didn't know borders, and catered to all, while granting financial control and privacy to everyone. Thus, bitcoin was invented. $BTC $XHV $xUSD

2/

Over the last 12 years since bitcoin came to the world with a solution against centralized finance, it has spawned thousands of new crypto currencies all targeting specific use cases, and innovative new solutions for almost all industries that exist. $BTC $XHV $xUSD

3/

The sheer amount of potential crypto can offer to the world, is beyond words. It's bigger than anyone can explain, because it changes the economic model into a new system of economics entirely. This has not gone unnoticed by governments. $BTC $XHV $xUSD

4/

Governments are realizing now, that crypto is not going away, and that, it's very easy for people to take control of their finances without needing a bank, or reporting it for income tax. It's a power the people have never had. $BTC $XHV $xUSD

5/

@AdityaTodmal @niki_poojary I think the best Indian channel for Options Selling is @ThetaGainers, by far!

Carson Block of @muddywatersre writing in the FT lays the blame of stonk gyrations like GameStop (sub $20 on 12 Jan, up 18-fold in 10 trading days) squarely on low rates and passive investing.

This is Hogwash, Blatherskite, Buncombe, and

Pure Trumpery.

It was 1 stock out of tens of thousands in the world which moved that way and has become a meme unto itself of fantabulous stock and social movement.

Carson talks briefly about low rates and government bailouts, which theoretically should affect the others.

But then he falls into the trap that many others who do not understand passive investing do.

This is NOT how passive investing works.

To be clear: if a passive fund owns $1bn of stock of an index which has a Sum (Stock Float Shares x Price) of $1trn, that fund will own 1/1000 of the float shares of each stock.

If the price of 1 stock rises 23-fold in 11 days, passive investors will do...

exactly nothing.

If the rise in that 1 stock leads to the index float market cap moving to $1.02trln, then if the fund receives an extra $100mm, it will go buy exactly $100mm/1.02trln of the float of each stock in the index (i.e. just under 1bp - of EACH stock - Apple, AMZN, and GME).

Listening to grumpy MPs in the Commons today, you might incorrectly think the UK-EU agreement didn’t cover much.

Find the agreements here:

https://t.co/RIg0yhl9ee

The contents follow below to illustrate scope.

PART ONE: COMMON AND INSTITUTIONAL PROVISIONS
Title I: General provisions
Title II: Principles of interpretation and definitions
Title III: Institutional framework

PART TWO: TRADE, TRANSPORT, FISHERIES AND OTHER ARRANGEMENTS
HEADING ONE: TRADE
Title I: Trade in goods
Title II: Services and investment
Title III: Digital trade
Title IV: Capital movements, payments, transfers and temporary safeguard measures
Title V: Intellectual property

Title VI: Public procurement
Title VII: Small and medium-sized enterprises
Title VIII: Energy
Title VI: Public procurement
Title VII: Small and medium-sized enterprises
Title VIII: Energy

Title IX: Transparency
Title X: Good regulatory practices and regulatory cooperation
Title XI: Level playing field for open and fair competition and sustainable development
Title XII: Exceptions

Thoughts heading into 2021: 🎇🎇

We will be sharing some additional stocks in upcoming podcasts, but we've 🤜#Pounded🤛 a lot of stocks in 2020 --> So what are we keeping in 2021 and beyond?

For Full Newsletter Email Us! 📩

[email protected]

Thread Below 👇👇👇👇

Top Winners Since Pounding The Table Started:

👊 $JMIA +475%
🌲 $GRWG +352%
👊 $MGNI +264%
👊 $NTLA +192%
🌲 $TRSSF +190%
👊 $EDIT +142%
👊 $NNOX +136%
👊 $CELH +125%
👊 $MP +122%
👊 $FTCH +120%
👊 $SI +119%
👊 $CRWD +106%
👊 $BLFS +99% (Close enough)

Details Below:

"Heads Of The Table"

We’ve broken more tables than IKEA has on backorder in pounding these so much. These swaggy Mini Monsters grew into full-fledged beasts and likely will continue to dance in 2021!

👊 $MELI
👊 $SE
👊 $TDOC
👊 $FVRR
👊 $SQ
👊 $ETSY

Ecommerce Leaders In 2021: Yes, some of these eCommerce stocks are in "Heads of Table" and some further below in SPAC's

We are looking at these 2 to continue in 2021.

👊 $JMIA
👊 $FTCH

Genomics: These had incredible runs in 2020 and should only continue in 2021. Health is Wealth, if we can find ways to get healthier - convince us Genomics won't continue to flourish

👊 $ARKG - ARK ETF
👊 $BLFS
👊 $CRSP
👊 $EDIT
👊 $NTLA
👊 $NVTA

If you are in the top 10% of the income distribution,

and you are a Rightwing Free Market Libertarian

(you want *zero* government enforced wealth redistribution)

the probability you are motivated by real ideological conviction is low...

...the probability you are motivated by sheer self interest is high.

People are not trustworthy witnesses as to what their own motivations are.

If you ask a rich person who wants zero government enforced wealth redistribution (Socialism) why they want this, they are likely to give you Free Market Libertarian rhetoric about some 'Non-Agression Principle'.

The truth is much simpler; they care a lot more about their ability to NOT pay taxes, than they do about poor people's ability to access free stuff in the form of government services.

1) There are several secrets to becoming a successful #investor and most are hiding in plain sight.

2) This many sound like a cliché, but it hides a simple truth: buy quality companies. When I started #investing, I didn't feel like I could identify quality, so I bought a subscription to @TheMotleyFool and let them do the heavy lifting.

3) I paid $199 per year each for @TheMotleyFool #StockAdvisor and #RuleBreakers subscriptions. They have paid for themselves MANY times over.

4) Another obvious strategy that FAR too many #investors ignore is that "winners keep winning." "That one got away from me, and now I'm waiting for a pullback" has probably lost investors more money than every pullback combined.

5) To put this into practice, I look at the recent list of @TheMotleyFool recommendations and see which #stocks have put up double- or triple-digits gains in recent months and then try to understand why. In many cases, I end up buying the stock, even after 30% 40% 50% gains.

Peter Lynch is a great investment manager of all time. He is famous for introduction of PEG. (P/E growth)

According to Mr. Lynch the faster the company grows, the higher the P/E ratio you should pay for that company

Here is a Thread - Peter Lynch thoughts & my interpretations.

1. Investing is fun, exciting & dangerous if you don’t do any work

Fun becoz we tend to learn so many things

Exciting becoz it give great moments of celebration because of unimaginable wealth

Dangerous becoz it can be addictive due to greed & people may start finding shortcuts

2. You can outperform the experts if you use your edge by investing in companies or industries you already understand.

Study businesses, apply common sense and invest into something which you understand.

No need to adventure & no need to be part of anything or everything.

3. The stock market has come to be dominated by a herd of professional investors. You can beat the market by ignoring the herd.

Stay away from noise & crowd to come out as a winner.

4. Behind every stock is a company. Find out what it’s doing

The underlying entity of a stock is business. Choose to ignore everything else, but never ignore to study business.

Company includes few more things in addition to business like management, etc.

$ROKU keeps their long term plans a secret. So I looked for clues in their job openings to see what their roadmap might look like. Producing original content, TikTok + more M&A? These are some game changers $ROKU might be hinting at.👇👇

$ROKU could be producing original content. There was a recent job opening for a Lead Production Attorney to work on its slate of original content. Work involves "drafting agreements to hire writers, actors, directors + individual producers". Quibi might not have been an 1-off.

If that isn’t enough, $ROKU is also hiring a ‘Business Affair Lead’ for their ‘Original Programming Business’ to negotiate agreements related to the development, sale and production of episodic/feature length programming. Experience in tv/film production required. 🤔

If $ROKU is producing originals, then some of their moves in the past year start to make a lot of sense: releasing app versions of the Roku Channel, getting the Roku Channel inside Fire TV/Samsung TV and acquiring the license rights from Quibi. They could have set the foundation.

$ROKU is also looking for a ‘Director of Programming’ to help identify ways to "expand its global programming offering into new video and non-video experiences within The Roku Channel". Such as sports, esports, fitness as well as content from digital creators + social videos.

A Thread on~ O V E R T R A D I N G

Sitting and observing the numbers flicker on the screen might be very exciting.

But have you ever felt like you might've done better? Or you're just too tired of waiting that you punch an order right in?

That's a Bad Idea.

So, Let's understand the reasons behind it and try to find a way out.

1. Not having a trading plan makes you clueless.
Your impulses start to take control of you.

2. Having a trading plan; But still taking impulsive/ random trades.
Because of adrenaline rush or gambling instinct.

3. Revenge trading
When you try to force a trade in order to recover from a previous loss.