Watching the @FSCDems hearing on GameStop.

1/

Ranking member McHenry says there is “wisdom to the crowd” and said that general public is more savvy and intelligent and people in Washington think they are. Funny. The Securities laws were created to protect investors. With a “seller beware” motto from FDR

2/

He is complaining about the accredited investor definition designed to protect people who cannot afford to lose money from being fleeced by securities offerings where there is not adequate disclosure.

3/

Now @RepMaxineWaters is introducing the witnesses and reading bios

4/

I agree with @BradSherman, the GameStop saga would make a great exam question. Especially questions about payment for order flow. Even if perfectly legal, is this a problem for the stability of our financial markets?

5/

**Thread**

The Chop.

The chop is brutal and I want to discuss more about what goes on inside a Traders mind when we form a choppy range and when we're inside a choppy range.

I hope you can take some lessons from this to adapt to these situations in the future.

RTs appreciated

The chop usually forms after strong moves in one direction or another, for this we'll keep the focus on BTC and use "up" as our direction for discussion.

So, $BTC rips higher, we're approaching ATH, you can't go wrong being long, then something changes.

As we move higher, as we approach key levels, your mindset changes. Sometimes you can feel invincible, you've simply had to push the green button for 2 weeks and you've been in profit.

Anticipation grows and dreams of smashing through ATH into new territory continue to build.

This is where the first issue comes in to play.

1. Overconfidence and the assumption that you have to be correct.

Your mindset begins to look like this. Everything is now skewed towards your confidence in breaking through $20,000. Everything sets up as an ATH break.

2. Absorption of Information.

At the same time as your own mind racing to higher targets. Twitter begins pouring fuel on the fire.

"Retail isn't even here yet!"
"Impulse from $20k could lead to $30k!"
"Can you imagine the liquidations above $20k?"

You're fed more information.

Position sizing is most important aspect of system development, which makes a big difference in your returns.

Thread on Position sizing strategies-

Money management is not any of the following-

• It does not tell you how much you will lose on a trade.
• It does not tell you when to exit.
• It is not risk control.
• It is not risk avoidance.

What is Position sizing-

1. Position sizing is that par of your trading system that answers the question "HOW MUCH" throughout the course of the trade,

• It tells you how big a position you should have at a given time when you are in a trade.

• This 'How much' makes a whole lot of difference in a trader's performance.

* Position sizing strategies-

* There are two basic position sizing strategies -
• Martingale
• Anti-Martingale.

1. Martingale strategies increase one's bet when equity decreases.

2. Anti-martingale strategies increase one's bet when equity increases.

Casinos love people who uses Martingale strategies.

Lets see an example of Roulette where one uses the martingale strategy and double the bet every time he loses-

Daily Bookmarks to GAVNet 01/18/2021

I gathered the best Youtube videos to learn Expiry trading for free.

If you want to master expiry trading, open this thread: 🧵

Collaborated with @niki_poojary

Here's what you'll find in this thread:

1. ATM strikes to zero
2. Big Gaps on Expiry Day
3. How to trade expiry when Nifty is behaving differently
4. Using Data points to trade expiry
5. Play for a flat move
6. How to profit post 3 pm exploiting the close price?

Let's go ↓

1. How to develop a framework to trade in ATM strikes on expiry day? Subhasish Pani on @vivbajaj Sir's channel.

One of call or put at ATM is going to go to zero.

Whichever is moving rapidly has a higher probability of going ATM/ITM. Sell the slower

2. How to trade a big gap up on expiry day?

If market bias is bullish and a gap-up happens, it comes for selling.

Can buy puts at the breakout of an inside candle as the market has a good probability of at least heading toward the previous day's

3. How to trade in Bank Nifty if it has already moved 160 points from its high to low by 11:30? @ThetaGainers

Sell near otms with double stop loss.

Avoid if stuck in a very small range.

Get out of both by 1

1/ Just realized this morning that it was 5 years ago today that I invested in @densityio ... it has truly been such a great career experience for me. Some notes ...

2/ Density is a privacy-first way to monitor how people or objects move around spaces. Today mostly office spaces. Plus warehouses, schools, retail outlets, government buildings

3/ Density is a software company that gives insights to property owners or occupants. To deliver value it required team to also build hardware. That has been a journey. VCs are scared of HW. It’s challenging but gives SW companies such great defensive moats.

4/ many of the great tech companies have used HW to great advantage. Apple, obvi. But Amazon (Fire, Kindle, Alexa/Echo, Ring). Google (Nest, cameras that built Streetview, Home, FitBit). Peloton. Roku. Just a few obvious ones. HW + SW is so powerful.

5/ Team pitched me on infrared devices. We weren’t convinced on accuracy but bet on team: Andrew, Garrett, Rob, Brian & others who I figured would iterate on solution. Plus, I had huge trust in seed investors @jtriest @Jason who voiced for them & @AvidanRoss who didn’t but liked

1) This year has been difficult for many investors, whether you are a novice or an experienced risk taker.

It would be useful to revisit today's money masters and see how they dealt with gut-wrenching loss.

It always helps renew my ambition. THREAD 👇

2) Paul Tudor Jones lost $10,000 when he was 22, and when he was 25 he lost about $50,000, which was all he had to his name.

3) In 1979, PTJ's fourth year in the business, he lost over 60% of the equity in his clients’ accounts on a single cotton trade that went horribly wrong.

“I am not cut out for this business," he said. "I don’t think I can hack it much longer.”

4) Relating the episode to Jack Schwager in Market Wizards, he revealed:

"It was a cathartic experience for me, in the sense that I went to the edge, questioned my very ability as a trader, and decided that I was not going to quit. I was determined to come back and fight."

5) That was when he first decided that he had to learn discipline and money management.

As Richard Dennis used to say to new traders, “When you start, you ought to be as bad a trader as you are ever going to be.”

If I stuck to this one rule the day I started trading I would have...

• Saved $1,000's of dollars in losses.
• Sped up my learning process.
• Avoided every major account drawdown I've had.

If you're new to trading, make sure you stick to this 👇🏼

The 1% Rule 🧵

The 1% Rule states that you should risk, at most, 1% of your total account on every individual trade.

This 1% risk is a function of two flexible components:

• Your Position Size: % of your account in the trade
• Your Trade Risk: % between your entry price and your stop loss

Want to take a larger position size? Make your stop tighter.

Trading a volatile stock? Size down on the trade.

The most important aspect of trading is risk management.

It's great to make money, but worthless if you don't have a system to keep it.

Over 50% of my trades are losses, but I'm still profitable because of the 1% Rule.

Keep losses small & let winners run!

"Nick, 1% risk isn't enough, my account is small."

New traders are EXACTLY who benefits the most!

By limiting each trade's potential losses to 1% it will take you:

• 29 straight losses to fall 25%
• 69 straight losses to fall 50%

It's tough to be that consistently bad 😅

1) Here is the thread I promised. It is going to a long read so I ask you to bear with me and be patient. I know most of you interested in $BNGO stock do not do genomics and feel intimidated by it so I will try to explain it using an analogy.

2) First, the Saphyr mapper is not a sequencer, it is, as its name say, a mapper. The difference of a genome sequence and a genome map is that the map aids to decipher the sequence more accurately (for sequence I refer to billions of ATCGATCG…).

3) A genome map is created before the sequencing begins and provides confidence in the sequence obtained. Therefore, the Saphyr mapper, does not compete or substitute any sequencing technology (either from $PACB, $ILMN, $TMO, etc.), but rather it is —COMPLEMENTARY— to it.

4) For an analogy, think of an any given address. Imagine I live at 14th Main street, Springfield, Massachusetts, USA. And someone asks me where I live, and I simply answer “Springfield”. If the person is local of Massachusetts, will probably assume that I live in Springfield MA.

5) However, if I’m asked in a state other than MA, and the person is from a state other than MA, will probably ask “which Springfield”, as there are many cities with this name in all USA; I would have to specify “Springfield, MA.”

Stocks from Reddit today. 💸💸

So last few days was a push for Weed Stock but now it is semi conductor stocks. Keep an eye out for the cheaper semi-conductor manufacturers. ⚡⚡

Here are the stocks we are tracking rn 👇🏼👇🏼

#PoolsApp #stocks #investing #trading #investors

$TNXP is a real BIO med value play in a sea of PnD’s.
Phase 3 trials, Institutional Backing

$SNGX breakout through major

$ASRT: Lawsuit win, sold shares, new

$CBBT declaring

"The Millennial Consumer Index" - My picks for a DJIA style 30 stock Index with Co.'s that best serve that demographic.

Fellow Millennials, What would be some of your picks?😀
@richard_chu97 @saxena_puru @FromValue @TMFJMo @dhaval_kotecha @adventuresinfi @reshoftc @BrianFeroldi

My criteria & list is
✔️US Consumer centric
✔️No B2B stuff (unless end-user uses it for non-Business reasons also)

This is just a Fun-Friday exercise. So don't take it too seriously and ask me why your fav co isn't there. Just add yours in the comments. 😂

Picks ⬇️⬇️
E-Commerce : $AMZN $ETSY $W $LULU $CHWY
Entertainment : $GOOG $NFLX $SPOT $ROKU
Social : $FB $SNAP $PINS
Finance : $SQ $PYPL $LMND
Food/Beverage : $CMG $SBUX $DPZ $CELH
Online Services : $MTCH $ZM $DOCU $TDOC $RDFN $FVRR
Life style : $AAPL $TSLA $PTON $ABNB $UBER

Let's keep aside the discussions about recent hype or over-valuations for any of these Co's.

This thread is about which Companies (in my Portfolio/Watchlist/Universe) are doing an awesome job of serving/engaging the Millennial Consumers (in US).

The intersection of Technology, Demographic, and Consumer (behavior) trends are incredibly powerful.⚡️

We often over-estimate what can happen in the short-term (hype) and under-estimate what can happen in 1-2 decades (strong trends).

1/18

Long thread ahead of $TSLA's first S&P week with some advice.

First off, to people only holding stock, my general advice is sit back, relax, and watch the show. Even before factoring in Tesla Energy and Autobidder, EVTOL jets, cooperation with The Boring Company, HVACs,

2/18

manufacturing as a service, electric boats, and various other potential lines of business, Tesla's long-term potential is enormous.

Tesla is basically untouchable in automotive, autonomy, and autonomous mobility as a service. Tesla will be a monster of a company 10-15 ...

3/18

years from now, selling and managing massive fleets of AEVs. If you're worried $TSLA might be becoming overvalued, perhaps so looking backwards, but it's still a hell of an investment looking far into the future.

I explained all this in this

4/18

For people who have no choice but to time the market during the next couple of weeks, either because they hold options, or because of a need to sell some shares (living expenses, big purchase, etc.), I have three pieces of advice.

5/18

My first piece of advice is to be aware of what outcomes are unacceptable to you, and to eliminate the possibility of them occurring entirely.

Today we're gonna talk about profits. They come from stock! #AdamSmith reminds us that stock is any resource paid for in advance when doing business. In general, profits and wages don't move together. (I.ix.1–2) #WealthOfTweets #SmithTweets

As stock goes up, there's more of it to employ more workers (by paying them or providing machines for them to work or both). This raises wages! But new stock competes with existing stock, which tends to lower profit. (I.ix.2) #WealthOfTweets #SmithTweets

If you thought figuring out the average wages of labor was complicated, don't even think about trying to figure out the average profit of stock. Basically impossible. Luckily, the rate of interest tends to vary with the profits of stock. (I.ix.3–4) #WealthOfTweets #SmithTweets

Lots of laws have tried to control interest rates and stop usury. They've all failed to do either. (I.ix.5–9) #WealthOfTweets #SmithTweets

Profits and wages rising together is unusual, but it happens. In particular, in new colonies. (I.ix.11) #WealthOfTweets #SmithTweets

Possibly the greatest NBER abstract ever written.

The Great Man theory of history.... turns out to have some pretty strong statistical support.

School closures had NO EFFECT (precise null!) on socioeconomic outcomes and future schooling behavior during the 1918 pandemic.

The authors note that school closures were not as long back then.

But also school calendars were far shorter. So idk how it shakes out.

Informing men about the odds their wife will die in childbirth reduces fertility, increases marital satisfaction, and reduces mismatch in fertility preferences within couples (in Zambia).

0/ We have the @RobinhoodApp & @vladtenev testimony today. The prepared remarks provide some insights on the business & what happened with $GME etc...

They have 13M customers, 13% trade options, 2% multi leg options and 3% are margin enabled

1/ The median age of an investors is 31; 1/2 are first time investors.

The median / average customer account size is $240 / $5,000.

This supports various theses that RH is the “play account” while users have another longer term oriented brokerage account.

2/ On the $GME saga they provide the timeline of collateral requirements during the week of 1/25.

Their obligation 1/25 as $124M the same day the VIX spiked 62% (3rd largest daily gain since 1990).

On 1/28 NSCC told them they had a deposit deficit of $3B. ($1.3B of VaR based)

3/ In addition to the VaR based they had an "excess capital premium charge" over $2.2B. The NSCC indicated RH owed $3.7B versus $696M already on deposit with NSCC, so the net amount due was approximately $3B

4/ They also mentioned over the course of 4 days they raised ~$3.4B from investors

So I saw #ShareYourForexStory is trending and Oh boy, do I have a story. 2019 was my lowest year financially and I needed to make quick wins and gains before we starved(Had 2 kids already). There was this scheme in Ibadan that claimed to pay 40% ROI for 6 months...see ehn

I had stalled and watched my friends cash in returns and I felt like I was losing time. The same friends I told about it so we could research had made their money back by the third month while research was doing me...."gbogbo wa Lama je breakfast" abi? These ones were on Dinner

So I gathered money from selling my car and taking a loan cos with my calculations, I'd have returned their money by month 3 and still have 3 months of ROI to play with. I has asked what they were investing in, they said Forex, real estate and lending to bigger companies.

See ehn, *sobs* I sha *sobs* put all money inside o! The first month ended....shebi I should have collected my interest, as Mr Adu taught me Compound interest, I asked them to add it to my capital and I did same for the second month. I had started pricing cars and natives to wear

In fact, one week I had 4 tailors come measure me all the way in Ikorodu(Ogijo oooo) as my money was coming! My other friend....A Gen Z that just got inheritance money had put 30million naira in without telling me, babe has been collecting 10m a month without me knowing,

What are prices?

A layperson’s guide to understanding charts and volatility.
1/

It’s an observable fact that price has nothing to do with value. Perhaps over the long term these two converge, but in the short term it makes no sense that the price of, say, soybeans would change 3-4% from day to day.

So what’s happening?
2/

You’ve probably heard people say “markets are forward looking” and that’s sorta true, I guess.

But that doesn’t mean they’re any good at it.

It might be better to say “markets consistently attempt to look forward” because that would be more illustrative of what’s happening.
3/

When a day-over-day price makes a 3% move this is not a 3% shift in value, it’s a 3% shift in *aggregate expectations about future value.*

And that makes sense, right? Expectations are pretty ephemeral so they can move fast.
4/

Consider volatility through this same lens. When a market is highly volatile, this means that expectations about forward value are evolving rapidly.

This happened in March when everyone got scared about Covid - it broke people’s forward expectations, and thus broke markets.
5/

A nobody cares thread.

Nobody cares about the things that matter - getting investors in, helping new distributors advisors, making things (Slightly) easier for investors, honest mis-selling etc.

Nobody cares about direct plans of mutual funds

Nobody cares about about mutual funds either

Very few care about mutual funds. Just 2.1 crore unique investors. If you probably take out HNIs/institutions in this, that's maybe 20-30%, what's left are the common gareeb folks.

Nobody cares about direct equity investing either.

Next time when someone says, people are moving away from mutual funds to direct equities, show them this and punch them in the throat.

Only 1.5 cr active demat accounts. If you remove duplicates, maybe 60% of this?

Nobody cares because very few people have money to care either?